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Solana’s price action on the four-hour timeframe showed that buyers were getting ready for another bullish leg up. Earlier in January, SOL had done a massive run up to $126 but the dampened sentiment in the crypto market led to a significant retracement for the altcoin.
However, buyers found solace at the $80 support level with the latest bullish candle breaking the bearish resistance at $90. This provides short term buyers with a low risk buying opportunity as SOL looks to regain its bullish momentum.
Buyers display strength at key support level
Following the significant price dip, SOL bears broke through multiple support levels, as price formed a series of lower highs. Yet sellers found the $80 support zone one level too far with buyers rallying strongly on the four-hour timeframe.
This spurred a reversal in the RSI (Relative Strength Index) with selling pressure gradually turning to buying pressure over a three day period. As of press time, the RSI stood at 58, as buying pressure continues to rise.
Similarly, the Moving Average Convergence Divergence (MACD) revealed buyers pressing home the rising bullish momentum with a bullish crossover and green histogram bars above the zero level.
Furthermore, the break of the $90 resistance has increased the buying leverage, offering an opportunity for new buyers to ride the reversal.
Short term traders can enter a buy position at $91 with a profit target at $100 for 11% returns. The long term extension of the price reversal will depend on bulls crossing the price hurdle around $104 price level with previous bullish attempts in January falling flat.
As an ecosystem, Solana continues to grow with the launch of 13 new token extensions, positioning Solana as the go to blockchain for developers.
Disclaimer: This article does not constitute trading, investment, financial, or other types of advice. It is solely the writer’s opinion. Please conduct your due diligence before making any trading or investment decisions.