SOL was well suited to selling pressure now that it was overbought. SOL broke through prolonged falling support.
The past three weeks have been quite favorable for SOL holders given the bullish performance achieved. But recent sightings suggest the party is about to end.
Read SOL’s price forecast for 2023/2024
If you held SOL in the second half of June, chances are you’re happy with your decision. This was because the cryptocurrency has been on an upward trajectory from its lowest price point on June 10. It reached a low of $12.82 and recently rose to $22.46, meaning it’s up more than 70% year to date.
Source: TradingView
Now that the bulls have been active for about 3 weeks, selling pressure is more likely. There are already some indicators suggesting that SOL is likely to favor the bears in the coming days. For example, SOL was now overbought according to the RSI and MFI.
Can the bulls withstand the incoming selling pressure?
$SOL breaks out of the descending channel on the 3-day TF card.#crypto #SOL #Solana pic.twitter.com/iGxxs9wHE2
— Captain Faibik (@CryptoFabik) July 8, 2023
SOL traders should note that this was the first time the cryptocurrency broke significantly above the same resistance line. It suggests that Solana is finally about to overcome her overall downward trajectory. Possibly in favor of a relief rally. If so, the bears can’t take over.
Over the past three days, there has been a surge in SOL’s onchain volume, in which the cryptocurrency’s upside has been expanding. The volume increase suggests that retailers have caught on to the trend. However, investor sentiment was still low, despite a slight upward trend after the initial dip over the past 30 days.
Source: Sentiment
While the breakout could trigger more upside, there was also a significant chance that whales would use this as an opportunity to take profits. This was because retail demand will provide exit liquidity allowing short term profit taking. Such a result could be a great opportunity for short sellers.
Is your wallet green? Check out the Solana Profit Calculator
Interestingly, SOL’s derivatives metrics indicate that short sellers may be moving into position. Both Binance and DYDX funding rates recorded a wave of negative funding rates, which could mean traders are going short. In other words, sales pressure expectations are growing.
Source: Sentiment
While most of the factors mentioned above point to a potential bearish outcome, caution is still advised. Residual bullish momentum could push prices higher before the final correction.
This post Solana’s impressive run may soon come to an end due to…
was published first on https://ambcrypto.com/sols-impressive-run-up-could-come-to-an-end-soon-because-of/
