Solana Bulls Must Surpass This Resistance to Avoid a 10% Plunge

Currently, Solana (SOL) price is showing signs of recovery from the corrective phase. However, to maintain the momentum, it is important for SOL to overcome the critical resistance level. In the last 24 hours, the price of SOL has increased by 4%.

During the past week, the altcoin has displayed remarkable upward momentum with an increase of over 9%. Despite the recent price increase, the technical outlook for SOL is still tilted towards a bearish bias. Both demand and accumulation for SOL have been low, indicating a bearish sentiment.

The volatility of bitcoin, with its price reaching $28,900, has affected the overall market, including altcoins. Although some of the leading altcoins have seen price appreciation, they are still struggling to break the immediate resistance levels.

Related Reading: US Bitcoin Investor Trading Volume Increases, Stage Set for Another Massive Rally?

Broad market stability is critical to SOL’s future performance. SOL’s market capitalization declined, indicating more selling power in the market

Solana Price Analysis: One Day Chart

At the time of writing, SOL was trading at $16.74. The altcoin recovered from the $14.40 price level and is currently showing steady appreciation on its charts. However, to consolidate the bullish momentum, SOL needs to overcome the immediate resistance at $17.20.

If the buyers fail to step in and push the price higher, a retracement is likely on the charts. Local support for SOL is located at $15.21. If the coin is unable to maintain its position above this support, it could decline further below $14.40.

technical analysis

Although SOL has recovered from oversold territory, buying strength remains relatively weak despite minor correction. This is evident from the Relative Strength Index (RSI) being below the half-line, indicating that sellers are maintaining control over the price action.

Additionally, SOL has declined below the 20-simple moving average (SMA) line, indicating that demand is still weak and sellers are the driving force behind the market momentum.

For a more positive outlook, it is necessary for SOL to successfully overcome the $17 price level. This success will potentially attract renewed demand in the market.

On the one-day chart, SOL is displaying mixed signals, including the emergence of buy signals. The Moving Average Convergence Divergence (MACD), which indicates momentum and potential reversal, has started forming a green histogram associated with buy signals. This suggests the potential for a positive price move for SOL in the future.

On the other hand, the Chaikin Money Flow (CMF), which shows capital inflows and outflows, remains below the halfway line. This indicates that capital inflows have been relatively low on the charts, indicating a lack of significant buying pressure for SOL.

Featured images from Unsplash, charts from TradingView.com