Solana on the Verge of Major Price Movement

Key Takeaways

Solana is up by greater than 40% from the $36.20 low hit on Might 12.
Nonetheless, the token seems to be locked in a consolidation sample.
An hourly shut exterior the $49-$58.80 vary might decide the place SOL goes subsequent.

Solana is buying and selling inside a slim vary. The excellent news is that as costs squeeze, momentum builds for a big spike in volatility.

Solana Exhibits Ambiguity

Whereas the cryptocurrency market continues to endure from Terra’s loss of life spiral, Solana is on the verge of a big value motion.

Solana ranks amongst the worst-performing cryptocurrencies in Might. The Layer 1 blockchain noticed its value drop by almost 60% through the first 12 days of the month. Though SOL has rebounded by greater than 40% from the swing low at $36.20, it’s locked in a consolidation sample that anticipates additional volatility on the horizon.

The hourly chart reveals that Solana’s value motion since Might 11 has led to an ascending triangle formation. The sequence of swing highs seem to have created a horizontal resistance trendline round $58.80, whereas the swing lows developed a rising trendline. A breakout from the sort of technical formation can happen to the upside and the downswing.

Nonetheless, the dearth of buying and selling quantity within the cryptocurrency markets means that SOL may very well be sure for a steep correction. An hourly shut under the triangle’s hypothenuse at $49 might encourage merchants to exit their place and improve the promoting stress behind Solana. Underneath such circumstances, the Layer 1 token would possibly dive towards $44 and even $40.

Solana price chart — *Supply: TradingView*

Given the magnitude of Solana’s losses over the previous month, it’s cheap that some merchants would preserve a bullish bias. However persistence is required to keep away from publicity to additional dangers. Solely a sustained hourly shut above the $58.80 resistance degree would sign the start of a bullish impulse.

Slicing by such an important provide wall might set off a brief squeeze that sends Solana to a excessive of $78. This goal is decided by measuring the peak of the triangle’s Y-axis and including that distance upwards from the technical sample’s X-axis.

Disclosure: On the time of writing, the creator of this piece owned BTC and ETH.

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