The Solana SOL price has remained within two falling converging trendlines over the past five weeks, revealing the formation of a wedge pattern. As the crypto market faces continued uncertainty, the SOL price clings to this chart pattern, hinting at a genuine setup that could impact the altcoin’s forthcoming trajectory. Here’s how traders might seize an opportunity from this pattern.
A bullish breakout from the resistance trendline of the wedge pattern would signal a trend reversal. However, the 20-day EMA is consistently limiting the rising SOL price. As of now, the 24-hour trading volume in the Solana coin is $249.5 million, marking a 122% increase. The SOL price currently sits at $19.88, receiving support from the lower trendline of the wedge pattern.
The long-tail rejection tied to the daily candle suggests that buying pressure is intensifying at the lower trendline, increasing the chance of a bullish reversal. However, any price reversal will likely face immediate resistance from the overhead trendline at around $20.3. A breakout from this resistance trendline is crucial for restoring bullish momentum and initiating a fresh recovery cycle.
A rally following the breakout could propel prices to significant chart levels of $21.2, $24.8, and $26, resulting in a potential gain of 30%. Consequently, the current correction phase in the SOL price will persist as long as this pattern remains intact.
While analyzing technical indicators, it becomes evident that the downsloping moving average convergence divergence (MACD) and the signal suggest that selling momentum is still aggressive. Furthermore, the daily exponential moving averages (EMAs) of 20, 50, and 100, accumulated near the $21.2 level, create a robust resistance level.
In terms of intraday levels, the SOL spot price is $19.87, with a bullish trend and high volatility. Resistance levels are $21.2 and $23.8, while support levels are $19.7 and $16.
It’s crucial to note that the content presented here may contain the author’s personal opinion and is contingent upon market conditions. Always conduct thorough market research before investing in cryptocurrencies. The author or the publication is not responsible for any personal financial loss.
Source: Coingape
