Cryptocurrency Solana faces volatility as market price trends remain uncertain. With over a 2% loss in the last 24 hours despite market recovery signs, technical indicators suggest a possible decline.
Technical Analysis: Is a Drop Imminent for Solana?
In Solana’s four-hour price chart, the descending wedge and head and shoulders formation appear simultaneously. The $136 level serves as the “neckline” for these formations. If SOL closes below this level on a four-hour candle, analysts forecast a potential drop of 12%, suggesting the price could retreat to $120.
Another notable aspect is the downward trend line that has pressured the price since January. SOL has consistently declined whenever it nears this trend line. The recent price drop has also led to the formation of a strong “bear engulfing” candlestick pattern, further increasing the expectations for a downturn.
TD Sequential Gives Sell Signal for Solana
Experienced crypto analyst Ali Martinez announced on social media platform X that the TD Sequential indicator has issued a sell signal. This indicator had previously predicted SOL’s 22% rise, leading investors to take the current sell signal seriously.
Nevertheless, opinions vary on the reliability of this signal. Such technical indicators can sometimes be misleading, and market pricing does not always follow them precisely. This is particularly relevant for high-volatility altcoins like Solana, making multi-indicator analysis crucial.
Investor Behavior in the Market
Investor behavior is intriguing. According to Coinglass, there are $167 million in leveraged long positions open at the $135 level, indicating that a majority of traders are still taking bullish positions. Conversely, there are $83 million in short positions at the $140 level. This imbalance could lead to price movements within a tight range in the short term.
The current situation with Solana underscores the market's uncertainty regarding its price trends. Despite sell signals, traders' positions and behavior continue to play a crucial role in shaping future price movements.
