Solana (SOL) Price Could Increase by 70%, but Only if It Clears This Resistance

The Solana (SOL) terms could soon interruption retired from its short-term signifier and marque different effort astatine breaking retired from a semipermanent absorption line.

In Solana news, the measurement of decentralized exchanges connected the Solana protocol fell considerably from its Jan. highs. The main crushed for this is waning involvement successful the Bonk (BONK) blockchain project, whose merchandise caused a monolithic spike successful involvement past month.

Solana Price Gets Rejected

The regular illustration method analysis shows that the SOL token price has fallen beneath a descending absorption enactment since Aug. 2022. The enactment has caused 2 rejections (red icons), astir precocious connected Jan. 29. The rejection began the existent downward movement.

The driblet was preceded by a bearish divergence successful the RSI (green line). Moreover, the indicator is present beneath 50, a motion of a bearish trend.

Therefore, the inclination is considered bearish unless the Solana price breaks retired from the absorption line. A breakout could pb to an upward question toward $37. This would beryllium an summation of 70%, measuring from the existent price.

SOL/USDT Daily Chart. Source: TradingView

Solana Price Breaks Down From Support

The short-term, six-hour illustration shows that the SOL price broke down from an ascending enactment act connected Jan. 30. Afterward, it validated it arsenic absorption connected Feb. 2 (red icon). The terms has fallen since. 

Over the past 3 days, the SOL token terms has traded somewhat supra the 0.382 Fib retracement enactment level. Additionally, the six-hour RSI has generated bullish divergence. Similarly to however the regular RSI initiated a drop, the six-hour 1 tin initiate a bounce. 

Therefore, the SOL terms whitethorn summation toward the absorption enactment erstwhile more. On the different hand, if it falls beneath $19.67, the integer currency could autumn to $17.46.

SOL/USDT Six-Hour Chart. Source: TradingView

Where Will Correction End?

Finally, the terms past from the two-hour illustration shows that the SOL terms is trading wrong a descending parallel channel. Such channels usually incorporate corrective patterns, meaning that an eventual breakout from it would beryllium expected.

The information that the terms is trading successful the precocious information of the transmission and the bullish divergence from the six-hour illustration enactment this possibility.

Since the transmission is adjacent to the semipermanent absorption line, a breakout supra it could besides trigger a breakout from the line. In that case, the SOL terms could summation to $37.

While the Solana terms could autumn to the enactment act erstwhile more, validating the 0.5 Fib retracement enactment level astatine $17.46, this would inactive not invalidate the bullish forecast. However, a breakdown from the transmission would bash truthful and could pb to a driblet toward $9.

SOL/USDT Two-Hour Chart. Source: TradingView

To conclude, the astir apt Solana terms outlook is simply a breakout from the short-term transmission and an effort astatine breaking retired from the semipermanent absorption line. On the different hand, a breakdown from the transmission would invalidate this forecast and could pb to a important autumn toward $9.

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