Solana (SOL) has presented an enticing buying opportunity for those daring enough to trade against the current market trend. Despite technical indicators hinting at a potential rebound, bearish sentiment remains strong, suggesting caution for investors. As SOL’s bears hold their grip, the short-term outlook may not be as optimistic as some traders might hope.
SOL’s Buy Signal—But There’s A Catch
The Tom DeMark Sequential (TD Sequential) indicator, a well-known tool among traders, has flashed a buy signal on Solana’s daily chart. This signal hints at the possibility of a price rebound if accumulation picks up. The TD Sequential identifies points of trend exhaustion, often signaling when a price reversal is likely. It does so by tracking the price movement over nine candlesticks, and when it reaches nine in a downtrend, it signals a buy.
For traders seeking a low entry point, this could seem like a golden opportunity to buy Solana before the price rebounds. However, not all technical indicators align with this optimistic view, pointing instead to a possible further decline before a true recovery. One such indicator is the Relative Strength Index (RSI), which currently sits at 39.07, suggesting weak buying pressure in the market. A reading below 50 typically indicates an oversold condition, and in this case, it signals that the bearish trend may not yet be over.
Bearish Resistance Dominates
Adding to the caution is the Ichimoku Cloud, a technical analysis tool that identifies trends, support, and resistance levels. SOL’s price is currently trading below the Ichimoku Cloud, indicating that the token is under significant resistance. The Leading Span A and B of the cloud now serve as crucial resistance levels, preventing any upward momentum in the short term. When an asset trades below the cloud, it suggests that the market is in a bearish state and that further downside could be expected.
Solana Price Prediction – Breakpoint Conference Could Shift Momentum
Despite the bearish signals, some crypto analysts see a silver lining for Solana. Mosy Alpha, a trader on X (formerly Twitter), is optimistic about SOL’s performance ahead of the Solana Breakpoint conference, scheduled for September 20-21. Historically, SOL has performed well during this event, and Mosy suggests that traders preparing for the conference could push Solana’s price past the resistance levels of the Ichimoku Cloud. If buying pressure increases, SOL could potentially reach $171.91.
However, Mosy also emphasizes that this bullish outcome is contingent on key factors like market liquidity and the overall reception of the Breakpoint event. If the conference fails to exceed market expectations, or if liquidity remains low, the bullish projection could quickly fade. Should the market fail to provide enough support, a close below $126 could trigger a decline toward the August 5 low of $110. If that level fails, SOL could see losses extend to $90.
Also Read: Solana (SOL) Plunges 40% From ATH – Analyst Predicts Potential 9% Rebound To $142
While Solana’s technical setup offers a buying opportunity, investors should remain cautious. The strong presence of bearish resistance, combined with weak buying pressure, indicates that any short-term gains may be followed by further declines. As the Solana Breakpoint conference approaches, traders should closely monitor the market’s liquidity and sentiment before making any major moves.
For those willing to take the risk, the opportunity to trade Solana at current prices is there—but the catch remains that a brief devaluation may occur before any sustained recovery.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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