Altcoins

Solana: Drawing up a strategy for SOL traders amidst the market drawdowns

Disclaimer: The findings of the next evaluation are the only opinions of the author and shouldn’t be thought-about funding recommendation.

Since its April highs, Solana (SOL) has been enduring heavy sell-offs whereas the sellers breached essential helps and flipped them to resistance. Over the previous day, SOL plunged under the $32-level amidst the market-wide uncertainties.

As the alt continues its south-looking pattern, the subsequent few candlesticks could be essential to verify both a near-term revival or a continued decline.

With the latest spike in promoting volumes, a detailed under the $27-support would place for an prolonged draw back. At press time, SOL traded at $27.55, down by 13.07% within the final 24 hours.

SOL 4-hour Chart

SOLUSD 2022 06 13 13 28 25

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Source: TradingView, SOL/USD

SOL’s latest drop from the $40-mark carved a path for a bearish rally that accounted for a 32% decline within the final two days. As a end result, the coin poked its ten-month low on the time of writing.

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Over the final month, the trendline resistance (white, dashed) has provided a powerful resistance while retaining SOL in a downtrend. A possible bounce-back from the $27-zone may give the bulls a much-needed hope to tug off a short-term revival.

However, the rising quantity pattern may play out in favor of the bears within the coming periods. Also, the Supertrend avoided altering its bearish outlook whereas steeply wanting south. 

The broader market sentiment may very well be important in influencing the upcoming strikes. A failure to ramp up the shopping for volumes close to the ten-month help area can provoke additional liquidations towards the $24-$26 vary. Any near-term bullish revival may very well be short-lived by the bearish endeavors close to the $30-$31 vary. 

Rationale

Capture 24 scaled

Source: TradingView, SOL/USD

As per the RSI’s deeply oversold outlook, a short-term revival may very well be due for SOL if the patrons maintain on to their quick grounds. The index, at press time, was approaching its long-term 21-support.

With the south-looking MACD line under the sign line and the zero-mark, the possibilities of an honest revival appeared reasonably slim.

Conclusion

SOL continued to say no after the bearish engulfing candlesticks supported by excessive promoting volumes and the bearish Supertrend. Given the present sentiment, a compelling fall under the $27-mark would open doorways for shorting alternatives as advised above.

In case of a bearish invalidation, bulls may discover a ceiling within the $30-$32 vary. Finally, keeping track of Bitcoin’s motion could be important in making knowledgeable calls.

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