Solana Price Deals With Multiple Sell Signals Amid Pulldown Eyeing $28

Last Updated July 23rd 2021
2 Min Read
  • Solana was rejected from $38 as overhead pressure increases the chances of hitting $28.
    • The TD Sequential indicator and the MACD present vivid sell signals.

    Solana price could not close the gap to $40, allowing sellers to have another field day. Tentative support at the 200 Simple Moving Average (SMA) did little to stop the losses. In the meantime, bears are stretching the down leg toward $30.

    At the time of writing, SOL trades at $34 while seeking support at the 50 Simple Moving Average (SMA). It will be helpful to the bulls if this immediate anchor holds; otherwise, the correction will continue.

    Solana price breakdown deepens

    According to the four-hour chart, the Moving Average Convergence Divergence (MACD) indicator had added credence to the bearish outlook. This is a technical indicator designed to explore the relationship between exponential moving averages (EMAs), mainly the 12-day and the 26-day.

    As the MACD follows the trend of Solana, it also calculates the momentum of the trend, in turn sending bullish and bearish signals. Some traders use the tool to identify oversold and overbought conditions when the MACD line oscillates around a mean line (0.00).

    Realize that a sell signal appeared when the 12-day EMA crossed below the 26-day EMA, thus, validating the ongoing downtrend.

    In addition, the Relative Strength Index (RSI) affirms the bearish trend as it drops below the midline. More sell orders will be triggered if the trend strength indicator closes the gap toward the oversold area.

    SOL/USD four-hour chart

     SOL/USD 4-hour chart 070821

    Traders must be aware of the support at $32, highlighted by the 100 SMA. If the price holds at this level, we are unlikely to see the breakdown extend to $28.

    However, the TD Sequential recently flashed another sell signal in the form of a green nine candlestick. This signal implied that bulls are losing their mojo as the bears prepared to take over.

    SOL/USD four-hour chart

     SOL/USD 4-hour chart 2 070821

    When the sell signal is validated, Solana is expected to stretch the bearish leg further down. Realize that most of the sell signals have been validated in the past, adding credence to the prevailing overhead pressure.