- The recent price action suggests that bulls have taken control, but the strong resistance at $162 could prevent an immediate recovery.
- Traders should closely monitor the resistance at $162 as a break above this level could be a sign of a stronger recovery.
Solana (SOL) had recently seen a decline after experiencing a classic ascending channel breakout and falling below critical support levels as bearish momentum took hold. The question is, can the bulls regain control or is further downside ahead?
Solana bulls have returned to the market
Source: TradingView, SOL/USDT
SOL faced bearish pressure at the beginning of August after failing to stay above the crucial $172 mark. Currently, SOL is trading at around $156.7, down almost 1.26% in the last 24 hours.
After bouncing off the support level of $142.15 on August 6, SOL managed to post a 20% gain in just over three weeks. However, this bullish momentum was short-lived as the price faced resistance at $162, a level that bulls have struggled to overcome this month.
Nevertheless, the price has reclaimed some crucial support levels and was hovering above the 20-day, 50-day and 200-day EMA at the time of writing.
It is worth noting that there was a slight downward pressure as the altcoin reversed the $162 resistance and the price fluctuated in a zone where more volatility could occur.
The RSI was above the 50 level at press time, indicating a slight bullish bias. However, buyers should watch for a possible close above the RSI resistance point at 60 to gauge the chances of a rally in the coming days.
Important levels to watch
The immediate support level to watch is near the $150 level (20-day EMA). If SOL can sustain above this level, it could attempt to retest the $172 resistance zone in the coming days.
However, if the bears continue to apply pressure and SOL drops below $150, it could result in a retest of the control point (red) of the VPVR indicator near the $143 level.
While total volume increased by 13% to $6.73 billion over the past day, open interest increased by 3.15% to $2.43 billion, indicating that traders were still actively participating but sentiment was rather bearish.
Source: Coinglass
The long/short ratio for the last 24 hours was 0.9249, indicating a slightly pessimistic sentiment among traders.
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However, on Binance, the SOL/USDT long/short ratio was bullish at 1.7917 – showing that a significant portion of traders were still optimistic.
Buyers should also keep an eye on Bitcoin sentiment and other macroeconomic factors that could influence SOL’s price action in the coming weeks.
