The Solana price was able to clear the resistance at $200 once again, putting it in another unique position for a potential downtrend. At the time, there are multiple formations that suggest that there is an incoming downtrend, putting the SOL price in a perilous position. This is highlighted by crypto analyst Melikatrader, who outlined the points at which the cryptocurrency could see major resistance.
Solana Price Faces Possible Resistance
The analysis focuses on the descending broadening wedge pattern, alongside a budding trendline that shows the possibility of a reversal is high for the Solana price. The descending broadening wedge formation is a historically bullish one and has often preceded upticks in price. However, what usually happens first is the fact that the price could see an initial crash before a continuation.
This time around, the Solana price has come under scrutiny from bears after the break above $200. Solana has previously been rejected at this level multiple times. So, this suggests that the bears have a lot of power at this level and could drive the price back down again.
Meliketrader trader explained what would happen if the Solana price were to follow this trend again, showing a crash first before the altcoin will be able to pick up pace. The current wedge is between two diverging trend lines, one line being in a descending formation, and the other showing a sloping down pattern but moving much more slowly.
Since the pattern usually comes before an uptrend, it is expected that the Solana price could dip first, and then the reversal from the dip would trigger the uptrend. In this case, the Solana price is expected to move between the upper and lower trend lines outlined in the chart before it is able to break out.
In the event of a crash, the support zone for the cryptocurrency lies at $192-$193. A descent to this point would mark a 10% decline for the altcoin. Nevertheless, there is support, and this is a historical demand zone with strong momentum from bulls.
Once the breakout is completed, the price is expected to move upward rapidly, especially as the rest of the market works toward a recovery. This could set in motion the trend for further increases if the market continues to trade in the green.
Featured image from Dall.E, chart from TradingView.com
Editorial Process for is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.
