Of late, the Solana price has witnessed considerable bullish momentum, causing the coin to break through important resistance levels. In the last 24 hours, SOL is up close to 20%, and in a week, the altcoin has appreciated close to 40%.
As the Bitcoin price has been holding above $20,000, most of the altcoins have shown positive price momentum on their respective charts. If Bitcoin continues to rise higher, short-term bullish momentum will prevail throughout the market.
The technical outlook for Solana has pointed to the bullish, but the chart also reveals that since the coin has been overbought, SOL would eventually witness a price correction. Accumulation remains high on the chart as demand for the coin has been at a multi-month high.
Solana could present its buyers with buying opportunities; the coin could go back on your chart and then go back up. Solana’s market capitalization increased, which meant there was an increase in the buying force. Currently, Solana has been trading at 90% off its all-time high, which was secured in 2021.
Solana Price Analysis – One Day Chart
Solana was priced at $25 on the one-day chart | Source: SOLUSD on TradingView
SOL was priced at $25 at the time of writing. Solana went through many levels of resistance. The price of $25 has acted as strong resistance for the coin; it is imperative that SOL remains above that region to prevent bullish momentum from fading.
The coin’s overhead resistance stood at $31, but before the altcoin reaches that level, SOL is bound to trade south. Local support for the currency stood at $21.
The support region ranging from $21 to $18 will present traders with entry opportunities. The amount of Solana traded in the last session increased and was in the green, which meant that the coin represented bullish momentum.
Solana registers a rebound in buying force on the one-day chart | Source: SOLUSD on TradingView
SOL continued to show overbought trends, the asset was overvalued. Despite a small correction in demand, the coin’s accumulation broke out of the overbought region again.
The Relative Strength Index (RSI) was parked at the 70 mark, which was a sign that buyers were far outnumbering sellers on the daily chart. Similarly, the price of the asset was above the 20 simple moving average (SMA) line, which meant that the buyers were driving price momentum in the market.
Solana was also above the 50-SMA line (yellow), which is a sign of a bullish extension. On the other hand, SOL showed a death crossover where the 50-SMA crossed above the 20-SMA line, and that meant a drop in incoming price.
Solana Showed Buy Retracement Signals on One-Day Chart | Source: SOLUSD on TradingView
There were still bulls for Solana, but the buy signals for the altcoin were dwindling in size. Moving Average Convergence Divergence (MACD) represents price momentum and reversals. The MACD showed decreasing green histograms, which meant that the buy signals were decreasing on the chart.
The Bollinger bands, which indicate volatility, also parted, which meant that the coin would experience considerable price fluctuations in the coming trading sessions.
Featured Image from UnSplash, Charts from TradingView.com
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