SOL Technical Analysis: High Demand Confluence Area Teases Reversal
Solana is a very efficient open-source project which focuses on the permissionless nature of blockchain technology to provide decentralized financial (DeFi) options. The concept and the initial development started in 2017. SOL was officially launched in March 2020 by the Solana Foundation with headquarters in Geneva, Switzerland.
The protocol was designed to make it easier for decentralized application (DApp) development. Its goal is to increase the scaling by introducing a proof-of-history (PoH) consensus. It is paired with the core blockchain's proof-of-stake (PoS) agreement.
Let us move ahead to read about Solana technical analysis.
Past Performance of SOL
The SOL coin price gives a 40% downfall from the fallout of the 50% Fibonacci retracement level at $145. The fallout of $145 brings the bearish breakout of the 200-day Exponential Moving Average. Currently, the price approaches the 23.60% Fibonacci Retracement level, close to the $75 support zone.
SOL Technical Analysis
The SOL coin price action forms a broadening falling wedge pattern in the daily chart. The price rests at the support trendline close to the support zone of $75. The confluence of such high-demand areas increases the chances of a bullish reversal.
The recent fallout of the 200-day EMA and the bearish crossover of the 100 and 50-day EMA increases bearish attention for the coin. However, a reversal to retest the fallout of the 200-day EMA is possible.
The Stochastic RSI Indicator reflects a rise in underlying bullish sentiments for the coin. The indicator shows the K and D lines give a positive crossover in the oversold zone in the daily chart.
The DMI Indicator shows -DI rise significantly higher than the +DI in the daily chart. Moreover, the phenomenal rise in the ADX line signifies a boom in trend momentum.
In a nutshell, the indicators and the price action reflect a possible bullish reversal despite the solid selling pressure. Hence, RUNE coin prices can shortly give a buying opportunity.
Upcoming Trend
The SOL coin price approaches the $75 support zone and might find demand near the high demand confluence area, as mentioned before. However, the price action remains the key confirmation as the market remains highly bearish with extreme fear filling in the minds of investors.
Traders can find a buying spot shortly if the prices sustain above the $75 support zone. Bullish traders can target the levels of $115 and $135. However, if the bears undermine the bullish revolt, the support levels are present at $50 and $35.
At press time, TradingView Technical Analysis keeps a "SELL" sentiment for the SOL coin.