Solana (SOL) Attempts Bullish Reversal at $170

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Solana (SOL) bounced considerably on Dec 4, preventing a breakdown from the current bullish structure.

SOL has been falling since reaching an all-time high price of $259.9 on Nov 6. The decrease continued until a low of $169 was reached on Dec 4. 

During the descent, SOL broke down from an ascending support line that had previously been in place since Sept 22. Therefore, the breakdown suggests that this portion of the upward movement is complete. Furthermore, the token validated the line as resistance on Dec 9.

However, after breaking down, SOL bounced at the $170 support on Dec 4. This is both a horizontal support area and the 0.618 Fib retracement support level when measuring the upward movement.

This is a very crucial support area that could initiate numerous short-term bounces. As long as SOL is trading above it, the price action can still be considered bullish, despite the breakdown from the support line.

SOL Drop
Chart By TradingView

Short-term descent

Cryptocurrency trader @TradingTank outlined a SOL chart, stating that the token could decrease to $150 and potentially $130.

SOL Drop
Source: Twitter

However, the token has bounced slightly since the tweet. The bounce transpired at the $186 horizontal area, which has been in place since Oct 23. So far, it has caused six bounces (green icons). 

Furthermore, SOL is trading inside a descending parallel channel, which is considered a corrective pattern. This means that an eventual breakout from it would be expected.

However, it is still trading in the lower portion of the channel. If it is able to reclaim the middle of the channel, it would greatly increase the chances of a breakout in the near future. 

If a breakout occurs, SOL would likely increase towards a new all-time high and beyond.

SOL Channel
Chart By TradingView

For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.

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Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate school of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst.

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