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Analysis

Here’s what Solana’s latest bullish pattern means as demand hikes

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A Solana price drop below $24.15 would shift the market structure bearish, but evidence at hand suggested a move higher is more likely.
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Here's what Solana's latest bullish pattern means as demand hikes
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Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

  • Solana maintained a bullish market structure on the 4-hour chart
  • Strong gains on the OBV indicator meant buying pressure was steady

Solana [SOL] saw a large influx of buyers over the past five days. The price was at $22.6 on 7 August and saw a rally, trading at $24.8 at press time. The price action showed that further gains were likely, although a significant obstacle sat in the $25.5-$25.7 area.

How much are 1, 10, or 100 SOL worth today?

It is likely that SOL would breach this resistance, especially if Bitcoin [BTC] does not fall below $29.2k. From a higher timeframe point of view, Solana remains firmly bullish, and its strong bounce from just above the $22-level seems to indicate enthusiastic buyers.

Ascending triangle pattern showed a move to $25.7 is likely

Solana [SOL] forms a bullish pattern amidst rising demand

Source: SOL/USDT on TradingView

The green line at $23.5 outlined the bullish market structure break Solana saw on the price chart last week. The structure remained bullish and SOL formed a series of higher lows over the past five days. The recent price action saw an ascending triangle pattern (orange) develop.

Combined with the bullish structure, it highlighted that buyers were heavily favoured and another move north is imminent. The OBV seemed to be surging higher, underlining significant demand and reinforcing the idea of further gains for SOL.

The RSI signalled that bullish momentum held sway. The trading volume declined during the time SOL was within the triangle pattern. While an upward breakout was the expectation, a bearish move cannot be discounted. However, the evidence at hand supported the bulls.

Coinalyze data revealed firm bullish sentiment

Solana [SOL] forms a bullish pattern amidst rising demand

Source: Coinalyze

Speculator sentiment is bullish, based on the Open Interest chart. Over the past two days, both the price and the OI climbed higher. This suggested that the bulls were entering the market expecting further gains. The spot CVD has also been trending upwards over the past two days. The funding rate remains positive as well. Therefore, the short-term sentiment is bullish.

Is your portfolio green? Check the Solana Profit Calculator

A SOL move below $24.15 would shift the market structure bearish and invalidate the idea laid out here. To the north, the local high at $25.68 remains a valid target.

Moreover, there is a bearish order block (cyan) around the $26-region from 21 July. Ergo, it is possible that Solana bulls might not break out past this zone on their first try.

 

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Akashnath Sumukar works as a Senior Journalist at AMBCrypto. Based in Chennai, India, he has been an avid follower of the cryptocurrency market since Bitcoin’s boom and bust cycle of 2017. A graduate in Chemical Engineering, he is an expert in technical analysis. In fact, Akashnath has a particular interest in reading price charts and predicting how an asset will move over the short and long term. A self-taught trader and as someone who holds cryptos himself, he is always on the lookout for the next opportunity he can possibly capitalize on, while also educating his audience.
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