- SOL’s bearish momentum breaks the 30-day support level, with the potential for further downside.
- Traders see the $16 support level as a potential buying opportunity as MFI moves north.
- Fisher Transform bullish crossover, but caution advised for potential false signal.
In the last 24 hours, bearish momentum in the Solana (SOL) market has recently broken through the 30-day support level of $16.35, plunging to an intra-day low of $16.12. This move was caused by the bulls’ inability to break through the resistance at the intra-day high of $18.59. As of press time, the bearish influence was still strong, with SOL trading at $16.71, down 9.89% from its previous close in the last 24 hours.
Traders and investors should keep an eye on the $16.00 support level, as a break below it could result in further downward pressure on the price of SOL. However, if bulls retake market control, they could push the cost to the $20.00 resistance level in the short term, potentially signaling a bullish trend reversal.
The market capitalization fell by 9.90% to $6,402,717,536 while the 24-hour trading volume increased by 61.78% to $964,060,283, indicating that traders are taking advantage of the price drop to buy more, which could drive up the price further if the bullish momentum continues.
SOL/USD 24-hour price chart (source: CoinMarketCap)
The Bollinger bands on the SOL price chart are moving south, with the upper band touching $20.00 and the lower band touching $16.29. This move indicates that the SOL price is experiencing high volatility, and the market may be approaching oversold conditions, indicating a potential buying opportunity for traders.
Traders can buy at the $16.29 support level, sell at the $20.00 resistance level, or wait for a confirmation signal, such as a bullish candlestick pattern, before entering an extended position.
Since the Fisher Transform recently made a bullish crossover by moving above its signal line despite being in the negative region with a reading of -3.96, the bearish momentum may be weakening.
This move cautions traders’ decision to enter a long position, considering the potential risk of a false signal and implementing appropriate risk management strategies. If the Fisher Transform rises above the “0” line, it may signal a trend reversal and a stronger buy signal.
SOL/USD chart (Source: TradingView)
The Money Flow Index (MFI) reading of 13.36 indicates that the bearish momentum in the SOL market is gaining strength, as the MFI is below the oversold level of 20. However, because the MFI is moving north, a reversal could occur soon if buying pressure increases and pushes the MFI above the oversold level.
This bearish outlook in SOL is further supported by a Klinger oscillator motion below the signal line with a reading of -9.096k, indicating a potential downward trend in the price. This movement reinforces the notion that traders should keep an eye on the market because breaking the support level could result in a further sell-off in SOL.
SOL/USD chart (Source: TradingView)
As bearish momentum strengthens, SOL traders face potential downside risk, but oversold conditions and buying opportunities may signal a trend reversal.
Disclaimer: The views, opinions, and information shared in this price prediction are published in good faith. Readers must do their research and due diligence. Any action taken by the reader is strictly at their own risk. Coin Edition and its affiliates will not be liable for direct or indirect damage or loss.
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