Solana (SOL) – Locked in an ascending channelPosted on Tuesday, February 8 2022 at 9:29 pm GMT+0000
Solana (SOL) failed to gather sufficient buying traction to conquer the return line of the ascending channel stretched from the January 24th low and reversed lower.
The last positive thrust off the 80.80 low faltered in the vicinity of the 200-day simple moving average and the 50% Fibonacci retracement level of the last bearish wave. The short-term oscillators are indicating that the positive momentum has softened, as the MACD is falling below its trigger line closing in on the zero mark. Moreover, the momentum indicator has been moving against the market direction for the last five days, revealing a bearish divergence, warning that the bulls may be running out of fuel.
By gaining further confidence, sellers will initially eye the trendline of the channel and the adjacent strong psychological level of 100. By snapping that level, they will aim for the 90.00 round number before sliding towards the January 24th low at 80.00.
Alternatively, an improvement in sentiment could lift the price back towards the region encapsulating the 50% Fibonacci level and the 200-day simple moving average around 119.00. Successfully extending above it, upside progress may be challenged by the return line of the channel and the nearby 61.8% Fibonacci at 128.30. Should buyers pilot the price beyond this obstacle, they could turn their focus to the January 20th high at 145.00.
All in all, Solana bears are expected to dominate in the near term, likely calling for a retest of the lower line of the channel.