Solana has entered the new week with a strong bullish outlook, recording a 1.6% gain in the past 24 hours and reaching highs near $20. However, like many other tokens, Solana has been facing a challenging market structure, resulting in a 14% loss over the past 30 days. The SOL price closed August significantly lower than its monthly opening price of around $25.
The current price movement suggests that the path of least resistance has shifted to the upside, supported by a bullish outlook since the beginning of September and a strong support level at $18. The confirmation of this uptrend will depend on the ability of bulls to overcome the resistance at $20. A successful breakthrough would indicate a stronger bullish momentum, further reinforced by a buy signal from the MACD indicator.
Traders should pay attention to a potential bullish cross, where the blue MACD line flips above the red signal line. The RSI, although not oversold in August, is in the process of validating the ongoing rebound above $20.
While a break above $20 may not be sufficient to propel the Solana price to $30, bulls should remain vigilant until Solana maintains support above the next significant hurdle at $23. If this hurdle is surpassed, traders can consider booking profits at $25, $30, and potentially even $37.
Additionally, a falling wedge pattern on the four-hour chart suggests a potential breakout of around 12% to $22.5. This pattern indicates a possible end to the downtrend and a readiness for bulls to take control. The convergence of two downward-sloping trendlines forms the pattern, with decreasing trading volume. The breakout point typically sees increased buying activity, with the target representing the distance between the widest points of the pattern.
In the short-term chart, the MACD has already turned bullish, signaling a call for traders to place buy orders. The blue MACD line is above the red signal line, and the momentum indicator is generally moving towards the mean line and the positive region.
However, if the resistance at $20 holds, the SOL price may remain vulnerable to selling pressure. Support at $18 is expected to provide some stability, but there is a possibility of Solana sliding to $15 and potentially testing the support level at $8, which was established after the FTX implosion.
Overall, Solana’s price movement indicates a bullish outlook, but traders should closely monitor key levels and indicators to gauge the sustainability of the upward momentum.