Traders should expect this as Solana drops below its March low
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
- SOL cracked key support zone of $16.7 – $18.8 (cyan)
- Sentiment was neutral in the Futures market
After being marked as a “security” last Monday (5 June) by the U.S SEC, Solana [SOL] hasn’t seen any major upside move on the charts. The response by Solana Foundation hasn’t spurred any hopes for bulls as Bitcoin [BTC] hit $25k over the weekend (10/11 June).
Read Solana’s [SOL] Price Prediction 2023-24
At the time of writing, BTC struggled to cross $26k ahead of May’s CPI (Consumer Price Index) data scheduled for 13 June and the FOMC meeting on 13/14 June. A higher timeframe bullish bias for BTC, above $27k, could tip SOL to clear a key overhead roadblock.
SOL flips bearish after weekend dump
The weekend’s slump saw SOL breach the support zone of $16.7 – $18.8 (cyan). The support zone was also a bullish order block (OB) formed on 9 March on the daily chart. The weekend slump followed BTC’s retest of $25k, flipping SOL to a bearish bias after dropping below the trendline resistance and March’s low of $16.
Unless BTC moves beyond $26.6k and crosses above $27k, bulls could have difficulty clearing the confluence area of bullish OB and trendline resistance near $17. A price rejection at the aforementioned confluence area could drag SOL to $14.9 or $12.8 support levels.
Conversely, bulls could gain an edge if SOL close above the confluence area of $18.75. However, they must clear the overhead roadblock of $19.7 – $21.2 (white) – Another bullish OB-turned-resistance zone formed on 10 February on the daily chart.
The RSI slid into the oversold zone, at the time of writing, while the OBV dropped to 300 million, denoting a dip in buying pressure and demand.
The calm before the storm?
The 24-hour timeframe for SOL’s exchange longs/shorts ratio showed a neutral sentiment in the Futures market. Similarly, the overall crypto-sentiment, as of press time, was “neutral,” as per the Crypto Green and Fear Index.
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However, this could be the calm before the storm as price swings can be projected from 13 June. Traders should track this week’s (11-17 June) U.S economic calendar for more optimized trade set-ups.