Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- Trendline resistance has become a major obstacle.
- OI has increased since mid-May; CVD became negative.
Solana [SOL] market structure weakened as Bitcoin [BTC] struggled to stay firmly within the $27k price zone. Bears recently violated the $20 psychological level, exposing SOL to more selling pressure.
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Despite continued bearish pressure, the “Crypto fear and greedwas “neutral” at the time of going to press. This means the price of SOL could recover or take more losses. Which way for SOL?
SOL’s trendline resistance hurdle
Source: SOL/USDT on TradingView
Price action from the end of April was rejected at a key resistance level of the trendline (blue line). As of press time, there was another price rejection on the above obstacle, making it a major block for bulls.
Meanwhile, the Relative Strength Index dominated the lower ranges for most of May, repeating the waning buying pressure seen in recent weeks. Similarly, volume declined on balance over the same period, limiting a strong recovery opportunity.
A weakening BTC could continue to hold SOL below trendline resistance. As such, bears could drop SOL to the daily bullish order block and the support zone (cyan) of $16.7 – $17.8.
Alternatively, SOL bulls could break trendline resistance if BTC rebounds to $27,000 and rises. However, this depends on market conditions amid the ongoing US debt ceiling. The next target for bulls is $21.
OI improved while CVD decreased
Source: Coinglass
How many are 1.10, 100 SOLs worth today?
According to Coinglass, SOL saw positive open interest growth from mid-May after stagnating between May 9 and May 13. The OI rose from around $230 million on May 15 to more than $300 million on May 23, underlining the bullish sentiment.
The above period also corresponded to a rising cumulative volume delta, indicating that buyers were gaining the upper hand. However, the metric fell slightly from May 23, indicating that sellers were back in the game.
Source: Coinalyse
