Solana (SOL) Price Reaches New Yearly High After 120% Increase
The price action and indicators support the continuing increase, making it likely that the SOL price will continue increasing in the near future.
Solana Price Resumes Ascent After Long-Term Breakout
When examining the weekly time frame, it is evident that SOL experienced a breakout last week by surpassing a long-standing descending resistance line. This line has been present since November 2021, lasting for a span of 600 days.
Such breakouts from extended structures often indicate the conclusion of the previous trend and the commencement of a new one in the opposite direction.
In the case of SOL, the price has probably initiated a bullish trend reversal. The bullish candlestick this week further strengthens this possibility. The price now trades inside the long-term $28 horizontal resistance area.
Although the breakout is supported by the daily Relative Strength Index (RSI), it has yet to be confirmed. Traders commonly utilize the RSI as a momentum indicator to determine if a market is either overbought or oversold, assisting them in deciding whether to accumulate or sell an asset.
The RSI has shown a higher low and is currently above 50. However, there are two more days until the weekly close, so it remains to be seen if the RSI closes above this area.
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SOL Price Prediction: Is $40 on the Cards?
The technical analysis of the daily timeframe shows a 120% increase since June 10. During this increase, the SOL price broke out from a descending resistance line that had been in place since April 17. This successful breakthrough confirmed a bullish trend, particularly in the short term.
Furthermore, the daily RSI is currently above 50 and is increasing, providing further support for the validity of the breakout.
On July 14, the SOL reached a new yearly high of $32.13. The high was above the $26 resistance area, which is now expected to provide support. If the increase continues, the next resistance will be at $38.
Despite this bullish SOL price prediction, a close below $26 could catalyze a sharp fall to $20. However, there are no signs that suggest this will occur.
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