Is Solana capable of reaching $180?
Solana [SOL] appears on the brink of slipping beneath its 20-day exponential moving average (EMA), an indicator of a diminishing buying interest.
This observation emerges a week following the cryptocurrency's performance above this crucial moving average. The 20-day EMA of SOL marks the average trading price over the preceding 20 days.
A dip below this threshold suggests that the cryptocurrency is being traded at a price lower than its 20-day average, indicating a reduction in buying interest and an increase in sales pressure.
Increased bearish momentum in SOL
Analysis by AMBCrypto on SOL's price actions on a 1-day chart unveils a noticeable drop off in bullish momentum within the market.
For instance, data from the SOL's Moving Average Convergence Divergence (MACD) indicator exhibit a downward crossing of the MACD line (depicted in blue) over the signal line (shown in orange) at the current moment.
This phenomenon, known as a bearish crossover, hints that the asset's recent uptick in price might be tapering off, pointing towards a potential decline in value.
Such a crossover is commonly interpreted by traders as an indicator to either sell or engage in short selling while closing out long positions.
Additionally, the positioning of dots from SOL's Parabolic SAR indicator above its current price underscores this bearish sentiment. These dots have maintained their position since May 24, as discovered by AMBCrypto.
This trend-identifying indicator, when showcasing dotted lines above the price of an asset, signals a downturn, suggesting a continued decline in the asset's price.
Moreover, the reading of SOL's Relative Strength Index (RSI) at 53.47, pointing downwards at the moment, indicates a rising selling pressure on the altcoin.
Solana's path isn't doomed
Should the downward momentum in buying continue, SOL's price could potentially drop to $162.56.
Conversely, should this bearish forecast be overturned and the bulls take over, the cryptocurrency could experience a surge, potentially trading above $170 at an anticipated price of $172.73.
The prospects of such an upward movement in the near term remain feasible, as SOL's funding rate in the futures market holds positive amid recent challenges.
Funding rates in perpetual futures contracts serve as a mechanism to align the contract's price closely with the spot price.
A positive funding rate indicates a prevailing demand for long positions. Per data from Coinglass, SOL's funding rate stood at 0.0147% at the time of writing.
