Solana’s price is contemplating a 45% run-up over the week as it attempts to break away from its falling wedge and tag its hourly supply zone. The outlook was backed by a bullish divergence on the RSI and an early buy signal along with the MACD. However, an early test awaits at the 38.2% Fibonacci level, which could be detrimental to a continued rally. SOL traded at $95.1, up by 9% over the last 24 hours at the time of writing.
Solana 4-hour Time Frame
A bright start to February saw Solana extend its headstrong rally after discovering a new demand zone between $89-$80.7. Nevertheless, the bullish effort fell short of expectations, with SOL rejected at the 4-hour 200-SMA (green) and 61.8% Fibonacci level (calculated through SOL’s drop from $138.6-$80.7). The resulting falling wedge has featured on SOL’s chart for nearly two weeks now, with bulls unable to shake off a streak of lower highs and lower lows.
However, bulls could very well be rewarded for their patience. Solana’s wedge had reached the upper boundary of the demand zone once again- ideal for a breakout from the pattern. A breakout could come as early as the next 24 hours, provided SOL can create a 4-hour candle above the 50-SMA (yellow) and 23.6% Fibonacci level. The resulting move carried a 45% upside potential, bringing SOL back to its hourly supply zone of $138.6-$130.
Keep in mind that the expected move would be laborious in a risk-off broader market. Hence, an extension deeper into the demand zone should not be ruled out. In either case, SOL’s bullish bias would remain as long as its holds above $80.7.
Indicators
The 4-hour RSI spotted a massive bullish divergence after creating a series of higher lows. A move past 55 would help the index surpass a chunk of sell pressure and invite more bullish speculation.
Meanwhile, the MACD prepared to take another swing at the halfway mark, helped by a bullish crossover.
Conclusion
Solana’s mid-term was looking encouraging. The indicators showed early signs of a bull run as the price traded within a region of demand. A 45% upwards push was expected going forward, provided bulls can work past some near-term hurdles.