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Over the past few trading sessions, the Solana price has been lacking direction. It is currently showing a bearish trend. The daily chart indicates that SOL has lost almost 4% of its value. Over the past week, it has fallen by 5%, erasing most of its gains due to the recent decline in price.
Additionally, the technical outlook for Solana is bearish. Demand has been falling as buyers have stayed away. SOL also depicted negative accumulation at the time of writing. Although SOL is currently heading in a bearish direction, there is still potential for a rally if it breaks through its overhead resistance level.
However, this will require a return of demand for the altcoin and consistent trading of Bitcoin above the $28,000 mark. Continued consolidation for SOL could lead to a loss of its current support and a subsequent drop in value over future trading sessions. The market capitalization of Solana has also decreased, indicating increased selling pressure on the daily chart.
Solana Price Analysis: One-Day Chart
At the time of writing, Solana was priced at $21.57. Its overhead resistance level was identified at $23.30, which also serves as crucial as it has previously acted as a sell zone for the coin.
If SOL manages to surpass this resistance level, it could potentially reach $26. This will result in a price appreciation of almost 22%. Conversely, a decline from the current price level would push Solana down to $20 and eventually $18.
The trading volume of Solana in the last session decreased, indicating a drop in demand for the altcoin at the time of writing. It is important to note that breaching the $23.30 resistance level would require a resurgence of demand for SOL.
Technical Analysis
Over the past week, demand for the altcoin has remained low, causing buyers to lose confidence, especially after its fall from the $23 level. At the time of writing, the Relative Strength Index indicated that selling strength had surpassed buying strength, as it was below the 50 mark.
Additionally, SOL dropped below the 20-SMA line, signaling that sellers had taken control of the market. However, there is still a possibility for a bullish market if buyers make a slight push, allowing Solana to rise above the 50-SMA line. This move could attract more buyers and revive confidence in the altcoin.
On the one-day chart, SOL showed sell signals that are consistent with other technical indicators. The Moving Average Convergence Divergence, which reflects price momentum, has formed red histograms that indicate sell signals for the altcoin. This signals a bearish price trend.
Furthermore, the Directional Movement Index (DMI) is negative, with the -DI line (orange) positioned above the +DI line (blue). Additionally, the Average Directional Index (red) has fallen below 20, indicating a weakening direction in the current price.
