Solana (SOL) price failed to sustain its breakout and was rejected by the $37.60 resistance area on November 5. The direction of the future trend is not clear until there is a decisive movement.
Since Aug 13 the SOL has been falling below a long-term descending resistance line. At the time, it had reached a maximum price of $48.38. The downward movement looks like a complete ABC correction, with waves A:C having a 1:0.618 ratio. On October 21, its lowest price fell to $26.84.
Later, the ensuing upward move caused a breakout from the resistance line. This led to the November 5 high at $38.79. However, solana price was rejected by the $37.61 resistance area, formed by the 0.5 Fibonacci retracement resistance level and a horizontal resistance area. It has reduced significantly in the next 24 hours.
Therefore, technical analysis on the daily time frame is showing that the direction of the trend will be clear if the SOL breaks above the $37.60 area, or breaks below the $26.84 low (red line).
Solana Price Prediction: A Potential Breakout Could Lead to New Drops
The short-term two-hour chart is showing that SOL price is breaking an ascending support line. The line is in effect from October 21. Currently, it is coinciding with the 0.618 Fibonacci Retracement support level.
Consequently, whether solana price manages to move above it or is rejected (red circle) will determine the direction of the future trend.
A break below the $26.84 low (red line) indicates that the Solana (SOL) price forecast is bearish and new lows are expected.
On the other hand, a reclaiming of the support line may indicate that the upward movement will continue.
Is Futures Trend Bullish or Bearish?
Finally, the weekly price history provides a slightly more bullish outlook. The main reason for this is the weekly RSI and price volatility.
Firstly, solana price has formed a double bottom pattern (green icon) inside the $27 horizontal support area. The first floor formed a long lower wick.
In addition to being a bullish pattern, the double bottom was aligned with a bullish divergence on the weekly RSI.
As a result, weekly can be used as a tiebreaker, due to mixed readings from the daily and two-hour time frame. In this case, the start of an uptrend is more likely to be slightly higher than a breakout.
On the weekly time frame, a major resistance area is located at $50, formed by a long-term descending resistance line.
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