Solana (SOL) price broke out from the long-term horizontal and diagonal resistance levels. The price is likely to start a new bullish trend reversal.
The price action and indices support the continued increase, which makes it likely that the price of SOL will continue to rise in the near future.
Solana price resumed its climb after the long-term breach
On examining the weekly timeframe, it is clear that SOL saw a breakout last week by crossing the long-term bearish resistance line. This streak has existed since November 2021, and has been running for 600 days.
Such breakouts from extended structures often indicate the conclusion of the previous trend and the start of a new trend in the opposite direction.
In the case of SOL, it is likely that the price has started an upward reversal. A bullish candle this week reinforces this possibility. The price is now trading inside the long-term horizontal resistance area of $28.
Although the breakout is supported by the daily Relative Strength Index (RSI), it is yet to be confirmed. Traders typically use the RSI as a momentum indicator to determine whether the market is either overbought or oversold, which helps them decide whether to accumulate or sell the asset.
The RSI showed a higher bottom and is currently above 50. However, there are two more days until the weekly close, so it remains to be seen if the RSI closes above this area.
SOL Price Prediction: Is $40 on the Cards?
Technical analysis on the daily time frame shows a 120% increase since June 10th. During this increase, SOL price broke out from the descending resistance line that has been in place since April 17th. This successful breach confirmed the bullish trend, especially in the short term.
Moreover, the daily RSI is currently above the 50 level and is increasing, providing further support to the validity of the breakout.
On July 14, SOL reached a new annual high of $32.13. The rally was above the $26 resistance area, which is now expected to provide support. If the increase continues, the next resistance is at $38.
Despite this bullish prediction for SOL price, a close below $26 could trigger a sharp drop to $20. However, there are no signs that this is happening.
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Disclaimer
In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.
