Solana is currently trading around the $19.5 level, showing little price movement over the past week. In July, SOL’s price managed to break back above the key $20 resistance level as well as the 200-day moving average.
This triggered a strong rally of over 50% as SOL headed towards stiff resistance between $25-$30. However, the rally became overextended with the RSI surging above 80 into overbought territory.
Since then, SOL has pulled back and is now retesting support around the $20-$22 area which aligns with the 200-day moving average. This support zone could offer an attractive entry area for traders looking to go long in an overall uptrend.
Looking at the trend, SOL remains in a downtrend over the short- and medium-term timeframes but has reversed into an uptrend over the long-term. Momentum indicators are providing mixed signals at the moment. The MACD line is above the MACD signal line, which is bullish. However, the RSI is below 45 indicating oversold conditions and bearish momentum currently, according to altFINS.
Source: altFINS – Start using it today
To explain further, the MACD (Moving Average Convergence Divergence) line is calculated from the difference between two moving averages of the price. The signal line is an exponential moving average of the MACD line itself. When the MACD line crosses above the signal line, it is considered a bullish crossover signaling upside momentum. The RSI (Relative Strength Index) is a momentum oscillator that measures the speed and rate of price movements. A reading below 45 signals oversold conditions and bearish momentum.
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Show more +In terms of key support and resistance levels, SOL has nearby support around $19, with stronger support at $12. Looking overhead, initial resistance is at $25-$30, with stronger resistance not until $38. Traders will be watching to see if SOL can hold above support and start to regain bullish momentum to challenge overhead resistance.
Conclusion
In summary, Solana is struggling to gain upside momentum after its sharp selloff from its July highs. The coin is currently stabilizing around $19.5 after defending the $20 level and 200-day moving average. For SOL to confirm its long-term uptrend is intact, bulls need to see a break back above resistance at $25-$30. This could open the door for a retest of $38.
Alternatively, failure to hold the $19-$20 support zone could lead to a retest of the key $12 level. Traders should watch price action closely around these key support and resistance zones heading into the rest of September. Upside potential appears limited in the near-term unless SOL can regain its bullish momentum.
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