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Solana (SOL) has experienced a noticeable decline, with its price falling by 4% in the past day. This trend of bearishness goes alongside the crypto market downturn, bringing SOL’s price to around $ 162.61 as of press time.
This fall comes after the altcoin hit an intra-day high at about $169, and it set part of the ongoing correction phase that has seen it lose 8% over seven days. Despite this, Solana is up 15% in the last 30 days, having impressively grown by 592% in the past 12 months, beating many other crypto counterparts.
The recent slump in Solana’s value can be attributed to a sudden increase in trading volume, which rose by 15.41% from the previous day. Such an increased volume indicates that many sellers want to sell their coins because of what is happening on the market as a measure of taking profit.
Moreover, there was some kind of indecisiveness around $169, suggesting a temporary exhaustion of bulls. These patterns often result in retracements as they tend to make traders reflect on market dynamics.
Technical indicators provide more insights into how Solana moved its prices. The orange line represents a 30-day moving average and recently broke below the blue one (200-day moving average), which shows the intensity of the downtrend.
Concurrently, the Relative Strength Index (RSI) for SOL fell to 30 signaling that the asset is oversold, which might mean that either way, this asset is likely poised for recovery.
Despite the recent drop, Solana’s price has found support at its medium-term support level, luring new buyers who want to buy in and hope for a bullish reversal. The movement in prices was influenced by macroeconomic factors, including the FOMC’s decision not to change rates within the range of 5%- 5.25%.
Although traders reacted negatively when they heard this news, Federal Reserve Chairman Jerome Powell’s hints of a September rate cut can make Solana optimistic about price expectations for the next months.
Solana’s price chart shows the classic double-bottom pattern, which is a bullish reversal indicator pointing to a possible uptrend. Solana’s prices have retraced back to the neckline of the double bottom according to Crypto analyst Trader Tardigrade while noting that this resistance is important and lies between $190 and $200.The formation of this pattern indicates that Solana has established a strong support level after revisiting it twice in recent months.
The two troughs in mid-April and mid-June make up a double bottom pattern which was followed by recoveries. In this scenario, sellers may start fading away as buyers advance their bid prices.
In line with his analysis, Trader Tardigrade notes that a successful breakout above the neckline resistance is likely to target $320.
While prospects towards $320 are optimistic there could be certain difficulties. The market may become volatile around the neckline resistance during Solana’s spike. Before any definite upward move happens, traders should expect fluctuations and price activity shifting within the $190-200 area range.
