The Solana (SOL) price failed to sustain its breakout and was rejected by the $37.60 resistance area on Nov. 5. The direction of the future trend remains unclear until a decisive movement occurs.
SOL has been decreasing below a long-term descending resistance line since Aug. 13. At the time, it had just reached a maximum price of $48.38. The downward movement looks like a completed A-B-C correction, in which waves A:C had a 1:0.618 ratio. It led to a minimum price of $26.84 on Oct. 21.
Afterward, the ensuing upward movement caused a breakout from the resistance line. It led to a high of $38.79 on Nov. 5. However, the Solana price was rejected by the $37.61 resistance area, created by the 0.5 Fib retracement resistance level and a horizontal resistance area. It decreased considerably over the next 24 hours.
So, the technical analysis from the daily time frame suggests that the direction of the trend will become clear if SOL breaks out above the $37.60 area, or falls below the $26.84 low (red line).
Solana Price Prediction: Potential Breakdown Could Lead to New Lows
The short-term two-hour chart shows that the price of SOL is breaking down from an ascending support line. The line has been in place since Oct. 21. Currently, it coincides with the 0.618 Fib retracement support level.
As a result, whether the Solana price is successful in moving above it or gets rejected (red circle) will likely determine the direction of the future trend.
A decrease below the $26.84 lows (red line) would indicate that the Solana (SOL) price prediction is bearish and new lows are expected.
On the other hand, a reclaim of the support line could indicate that the upward movement will continue.
Is Future Trend Bullish or Bearish?
Finally, the weekly price history provides a slightly more bullish outlook. The main reason for this is the weekly RSI and price movement.
Firstly, the Solana price has created a double bottom pattern (green icons) inside the $27 horizontal support area. The first bottom made a long lower wick.
Besides being a bullish pattern, the double bottom was combined with bullish divergence in the weekly RSI.
As a result, due to the mixed readings from the daily and two-hour time frames, the weekly one can be used as a tiebreaker. In this case, the beginning of an upward movement is slightly more likely than a breakdown.
In the weekly time frame, the main resistance area is at $50, created by a long-term descending resistance line.
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