Solana: Long-term investors can follow this to avoid further losses

Disclaimer: The findings of the following analysis are the only opinions of the writer and should not be considered investment advice

Solana’s downward trend continues uninterrupted. The early February rally was promising and it appeared that SOL had flipped the $93 level to support before taking the next move up. However, the Russian invasion of Ukraine and the uncertainty and fear in the market have hastened a further decline in the value of Solana’s token. The long-term outlook has been bearish, although our recent report highlighted that sentiment could shift.

SOL-1D

Source: SOL/USDT on TradingView

Solana has been in a downtrend since mid-November when the price just couldn’t get above $240. In addition, it ceded the $188 level to the bears. Over the past few months, the price has tested the $81.13 level on several days, but has not yet clearly sunk below $80.

These support tests were also accompanied by a series of weak bounces from the $81 level – the first bounce reached $120, the next stopped at $100 and the third at $88. This was worrisome for long-term bulls as it indicated that a further downward trend was imminent.

The first sign of a shift in bias would be a push above USD 106 for SOL followed by a higher low on the daily chart.

rode

Source: SOL/USDT on TradingView

This reversal in bias did not seem likely, according to the indicators. The RSI has been below 50 for months together, a sign of a steady downward trend. The Aroon indicator also showed long periods of downward movement interspersed with periods of upward retracement.

The OBV has had a stable sales volume since December. There has been no new low on the OBV in recent weeks, but this in itself did not indicate a strengthening on the buyer side.

Conclusion

Until the market structure is broken, followed by a sustained rise in the OBV, there cannot be said to be an upward trend. On the upside, USD 106 and higher lows are a priority. Lower in the charts, the USD 70 and USD 58 levels could provide support if SOL sees another leg down.

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