Solana (SOL) again broke above a crucial resistance level that had hampered its recovery attempts during the November 2021-March 2022 price correction, creating prospects for fresh upside in April.
To summarize, when SOL’s price tested its multi-month downward sloping trendline in recent history, it had significant pullbacks.
For example, the SOL/USD pair fell by 60% two months after retreating from the mentioned resistance level in December 2021. Similarly, it had dropped by more than 40% in a similar retracement move in November 2021, prompted by a selloff around the trendline.
However, after breaking above the resistance trendline on March 30, Solana turned it as support (S/R flip), followed by an increase in trading volume that demonstrated traders’ confidence in the breakout move. As a result, SOL’s price increased by 25% to $135, bringing the psychological barrier level of $150 within grasp.
SOL’s breakout move above its falling trendline resistance coincided with a bullish crossover of its two important moving averages: the 20-day exponential moving average (20-day EMA; the green wave) and the 50-day EMA (the red wave).
The golden cross is a technical signal that happens when an asset’s short-term moving average exceeds its long-term moving average. This crossing is seen as a buy signal by traditional experts.
In addition to other fundamental and technical events, the 20-50 EMA crossover in August 2020 may have aided in propelling SOL’s price up by more than 650 percent to over $267. As a result, the golden cross increases SOL’s chances of continuing its rise and breaking over the falling trendline resistance.
If a technical fractal noted by Delphi Digital is to be believed, the upside chances improve much more. The crypto research organization found a link between the price of SOL and the combination of its two technical indicators: the S/R flip and relative strength index (RSI) divergence.
When applying Fibonacci retracement levels formed between the swing high of $261 and the swing low of $77.50, SOL/USD might continue its rise, with an interim upside target of $147-$150.
A decline around or before testing the $147-$150 price level, on the other hand, may result in SOL retesting the $120 as intermediate support, with a probable drop toward the 20- and 50-day EMAs.