- Solana price continues to hit new lows despite increased trading volume.
- A correction could be on the horizon for SOL, with the recent bullish momentum needed to continue for a trend change.
Solana [SOL] It has recently been facing intense downward pressure, pushing its price to new lows despite bulls’ attempts to maintain momentum.
Increased trading volume indicates increased market activity, but overall sentiment remains cautious as traders wait for signs of a potential turnaround.
Solana bulls remain cautious
Over the past five days, SOL has seen multiple explanations of an inverse head and shoulders (IH&S) pattern, which is typically a bullish reversal pattern.
However, the success of this reversal pattern depends on a strong breakout above the neckline (the resistance line formed at the tops of heads).
Source: Trading View
As for the Ichimoku Cloud, the price of SOL is currently trading within the cloud, which generally indicates an area of indecision or a potential trend change.
The cloud acts as a support/resistance area, and turns from red to green, indicating a shift towards bullish conditions in the short term.
The Tenkan-sen and Kijun-sen lines are relatively close to each other below the price, indicating that the short-term momentum is slightly bullish but still lacks strong conviction.
The MACD histogram, which measures the distance between these two lines, has moved from negative to positive values, indicating increasing, albeit cautious, upward momentum.
The RSI was around 59 at the time of writing, which is neither overbought nor oversold. The recent peak of the RSI below the overbought threshold (70) and subsequent contraction reflect the increase in selling pressure following attempts by bulls to push the price higher, in line with dovish sentiment.
Is SOL headed for a correction?
As the bulls try to flip the narrative to no avail, another narrative is taking shape. Stochastic tells us that a correction may be underway.
Source: Trading View
Solana may be due for a correction as the price may be seen as relatively high compared to its recent trading range.
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The Klinger Oscillator shows a crossover where the faster (green) line moves above the slower (blue) line, indicating potential short-term bullish momentum.
This is a positive sign for bulls if it continues.
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