Solana (SOL) has shown impressive growth recently, surging 15% in the past week to $237.88. However, technical indicators suggest a potential pullback before SOL can aim for its next target of $260.
Rising Wedge Signals Bearish Reversal
On the 4-hour chart, Solana’s price has formed a rising wedge pattern, a structure often signaling a bearish reversal. This wedge comprises two trendlines:
- Support trendline: Steeper and rising.
- Resistance trendline: Gradually rising
As the wedge narrows, the likelihood of a price drop increases. A confirmed breakout below the support trendline could lead to a notable downturn, halting SOL’s rally.
Money Flow Index Supports Bearish Outlook
The Money Flow Index (MFI) adds weight to the bearish sentiment. This indicator measures capital flow into and out of a cryptocurrency using price and volume.
- A rising MFI suggests buying pressure.
- A declining MFI signals seller dominance.
Currently, the MFI is trending downward, reinforcing the bearish implications of the rising wedge.
SOL Price Prediction: Pullback to $205 or a Surge to $260?
On the daily chart, SOL encountered resistance at $239.56 while trying to reach its all-time high of $260. The Fibonacci retracement tool offers further insight, highlighting the 23.6% level as a critical pullback point.
- If SOL breaks below the wedge, the price could decline to $205.12.
- Conversely, an upside breakout above the wedge could lead to a rally past $260, marking a new all-time high.
Conclusion
The Solana price pullback remains a real possibility as bearish indicators align. Traders should monitor key levels, particularly the $239.56 resistance and $205 support, to determine the next move. While the rising wedge hints at short-term challenges, a breakout could set the stage for a significant rally.
