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Solana faces bearish outlook as traders predict further decline

Solana faces bearish outlook as traders predict further decline

GrafaGrafa2024/08/30 02:25
By:Isaac Francis

Solana (CRYPTO:SOL) has struggled to break above the key resistance level of $169, failing to close above this mark for the fourth time since April.

This repeated failure has shifted market sentiment towards a bearish outlook, with traders increasingly betting on a decline in SOL's price.

The current funding rate for Solana has turned negative, suggesting that more traders are holding short positions than long ones.

A negative funding rate typically means that traders are paying to maintain their short positions, indicating a growing expectation of a price drop.

This trend points to a bearish market sentiment where participants are preparing for further downward movement.

Technical indicators reinforce this sentiment.

The Moving Average Convergence Divergence (MACD) for Solana is on the verge of a bearish crossover.

A bearish MACD crossover usually signals a shift in momentum from bullish to bearish, which could lead to increased selling pressure.

If the crossover occurs, it would confirm the bearish trend and likely push Solana’s price lower.

Solana could face further declines to test the critical support level at $126.

The inability to breach the $169 resistance for several months has positioned SOL for a potential price drop.

A breakthrough above this barrier could lead to substantial gains, but this is not expected in the near term.

If Solana manages to bounce off the local support of $137 without falling further, it could prevent a deeper drawdown.

However, a bullish reversal would only be considered if Solana breaches and turns $155 and $169 into support levels.

At the time of reporting, the Solana price was $140.37.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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