Solana (SOL) rebounded on September 21st, temporarily ending the decline since the all-time high on September 9th.

Despite the rally, the token has yet to confirm its bullish reversal and could still be in a correction.

SOL decreases after reaching ATH

Between July 31st and September 9th, SOL rebounded 705%, creating a new all-time high of $ 216 but generating a shooting star on the same day.

Shooting Star is a bearish candle with a long upper wick. It indicates that the sellers have prevailed and trend reversals are often ahead. No wonder SOL has fallen since then.

Technical indicators do not confirm the direction of the trend.

First, SOL bounced off the super trend line (green symbol) which is now bullish. Supertrend is an indicator that shows whether the trend is bullish or bearish. Since the price is above this line, the trend is considered bullish.

However, the MACD is in positive territory but is bearish and the RSI is currently right on the 50 line.

As a result, the daily timeframe provides conflicting clues as to the direction of the trend.

Daily SOL / USDT chart | Source: TradingView

Breakthrough SOL

SOL has broken the descending resistance line formed from its all-time high. However, it was rejected by the $ 0.618 fib retracement resistance at $ 178, which is a very popular level to end the price surge.

In addition, since the upward move is a three-wave structure (highlighted) after the breakout, it is most likely a corrective structure and the prevailing trend is bearish.

SOL / USDT 6-hour chart | Source: TradingView

Future movement

It is worth noting that when measuring the previous decline (highlighted), the SOL hit an all-time high right at the external fib retracement level of 4.618.

This zone often acts as a tip for a longer upward movement. As a result, the move since June may have ended with an all-time high on September 9th.

If true, the SOL is in wave C of the ABC correction structure, which is the final wave of correction.

The likely level for the SOL to complete a correction is the 0.5 or 0.618 fib retracement support (in white) at $ 118 and $ 95, respectively.

Daily SOL / USDT chart | Source: TradingView

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

SN_Nour

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