Will $20 Breakdown Trigger Further Downfall?

In the midst of a broader crypto market downturn, the Solana price recently encountered resistance at the $20.6 level, leading to a temporary retracement to $19.1. Although this appears as a 7% decline at first glance, the underlying technicals tell a different story. According to the daily time frame chart, this pullback serves as a crucial component of a bullish reversal indicator called an inverted head and shoulders pattern.

Also Read: SOL Price Jumps 5% to $20, What’s Next for Solana?

Chart Pattern Hints Recovery Phase Ahead

• The 200-day EMA wavering around $22 creates a strong resistance zone.
• Combining the bullish chart patterns—the inverted head and shoulders and the falling wedge—Solana coin appears well-positioned for an upward swing
• The 24-hour trading volume on the Solana coin is $161.4 Million, indicating a 13% gain.

Source-Tradingview

Over the past week, the SOL price has painted a picture of indecisiveness, as reflected by the formation of neutral doji candles in the daily charts. This pause in price movement came on the heels of a previous sharp decline, suggesting that bears are losing their grip and failing to extend their territory. 

Such stalling often indicates a transition phase in market dynamics. Within this context, the most recent pullback serves to complete the right shoulder of an inverted head and shoulders pattern. Following this classic bullish reversal setup, the Solana coin appears poised to rebound from the $19.1 support level to retest the neckline resistance at $20.80.

A successful break above this neckline resistance would likely serve as the catalyst for an accelerated bullish movement. Upon breaching this barrier, technical models suggest that the next logical target for this altcoin could be around $22.20.

SOL Price To Hit $30?

Amid the third-week recovery in the crypto market, the Solana coin gave a bullish breakout from a long-coming falling wedge pattern. This pattern had led to a correction trend for over two months, reflecting its breakout as an important shift in market sentiment. In theory, each swing high retesting the pattern’s resistance trendline stands as a potential target. Thus the anticipated upswing in SOL price is likely to hit $22.2, followed by $25.4, followed by $32

• Relative Strength Index: The daily RSI slope above 40% reflects sufficient bullish momentum for an upswing.
• Exponential Moving Average: The coin price trading below the daily EMAs(20, 50, 100, and 200) indicates the major trend is still bearish.