Solana (SOL) recovers after a sharp decline

Solana (SOL) price is expected to rise towards $27. The response once it gets there could determine the future trend.

SOL is the native token of the Solana blockchain created by Anatoly Yakovenko. Solana Network Grizzlython Hackathon End Grizzlython is an online hackathon for the Solana ecosystem on March 14th. In it, builders submit their projects and compete with others over a six-week period, and the winner has the opportunity to raise seed funding from leading crypto investors assisted by the Solana Foundation.

Solana (SOL) Price Hit Critical Level

Since hitting an all-time high of $259.90 in November 2021, Solana price has declined below a descending resistance line. In December 2022, the decline reached a low of $8. Next week (green icon).

Despite the gains, SOL price failed to move above the $27 resistance area or the descending resistance line. Besides, the weekly RSI is still below 50. Therefore, the trend cannot be considered bullish yet.

If there is a breakout, the next nearest resistance will be at $47. On the other hand, the rejection could trigger a decline towards the $14 support area.

Solana (SOL) Price Weekly Movement
SOL/USDT Weekly Chart. Source: TradingView

Solana (SOL) price recovers after falling

Technical analysis from the daily time frame shows that the price of SOL token started a downtrend on February 20. The decline was preceded by a bearish divergence in the daily RSI (green line) and reached a low of $16 on March 10.

However, the price bounced back at the 0.5 Fibonacci retracement support level, validating it as a support. It has been on the rise ever since.

Interestingly, the daily RSI is in the process of breaking out of the bearish divergence trend line and moving above 50. Both of these are considered signals of a bullish trend.

As a result, it seems that SOL price will continue to rise above the overhead resistance of $27.

Solana (SOL) price daily movement
SOL/USDT Daily Chart. Source: TradingView

Lastly, the shorter six-hour chart shows that SOL price has already broken above a descending resistance line. Additionally, there was a move above the minor $20.50 resistance, which is both a Fib and a horizontal resistance area.

Therefore, these readings support the continuation of the move towards $27. Once there, the response will determine the future trend.

On the other hand, a close below $20.50 would invalidate the bullish structure. If it does, it could catalyze a decline towards $17.60.

Solana (SOL) price short term volatility
SOL/USDT six hour chart. Source: TradingView

To conclude, the most likely Solana price forecast is an increase to the $27 resistance area. It is still being determined if the price will break out.

A close below the $20.50 minor support area will invalidate this bullish forecast. In that case, SOL price could decline again to the 0.5 Fibonacci support at $17.60.

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