Solana (SOL) price drops over 1.0% to $124.00 early Tuesday, edging lower following a three-week downtrend. SOL faces its third consecutive month of downside momentum, as well as its first yearly loss in three.
The “Double Doji” candlestick formation may have contributed to the altcoin’s recent losses. This formation highlights the market’s indecision and reinforces the subsequent move, which in this case is a downturn.
Apart from the candlestick pattern, bearish signals from the Directional Movement Index (DMI) momentum indicator also underpin the downside bias surrounding the Solana price.
However, a pullback in the trading volume and market capitalization (market cap) suggests hardships for SOL bears, which in turn highlights the multi-month support line surrounding $117.00.
According to Santiment, Solana’s daily trading volume eases from a three-day high to $3.29 billion, while the market cap also fades the previous week’s recovery from the lowest level since April, retreating to $69.84 billion at the latest.
Solana Price: Daily Chart Hints Bearish Biasness
Solana price extends Monday’s U-turn from a four-day high and justifies the “Double Doji” candlestick formation that signals the market’s skepticism and adds strength to the quote’s following moves, to the south in this case.
Additionally, the DMI’s Average Directional Index (ADX, red) line tops the Downmove (D-, orange) line, and both the lines are stronger than the Upmove (D+, blue) line, highlighting a bearish directional momentum.
As a result, the odds favoring SOL’s further downside toward a descending support line from early August, close to $117.00 at the latest, are stronger.
However, the year-end holiday mood and a lack of major scheduled catalysts might restrict the altcoin’s further weakness.
In a case where the Solana price drops below $117.00, the coin becomes vulnerable to slump towards the $100.00 threshold before targeting the yearly low of $95.33.
On the contrary, a three-month descending resistance line surrounding $134.00 guards the immediate upside of the Solana price.
Beyond that, a seven-week-old horizontal resistance area surrounding $146.00 and the $150.00 threshold can test the Solana price recovery.
Should SOL buyers manage to keep the reins passed $150.00, the 200-day Exponential Moving Average (EMA) and multiple hurdles marked since October, respectively near $168.00 and $170.00, will be the final line of defense for the SOL bears.
Solana Price: Four-Hour Chart Portrays Bearish Consolidation
On the four-hour (4H) chart, the Solana price fades the previous bounce off the multi-month low but lacks downside momentum as the DMI’s Upmove line (D+) tops the Downmove (D-), and the ADX line. That said, all three momentum lines on the DMI indicator are below the 25.00 neutral threshold and hence portray a sluggish momentum.
With this, SOL is likely to depict a slower grind toward the south, highlighting the $117.00 support comprising a multi-month support line, a break of which could shift the market’s attention toward the deeper levels discussed on the daily chart.
Alternatively, a convergence of the 200-bar EMA and a descending trendline from early October highlights $136.00 as a short-term important resistance for the Solana price.
Following that, a seven-week-old horizontal resistance area surrounding $146.00 and the $170.00 support-turned-resistance from October 11 could test SOL bulls ahead of the daily chart’s higher levels.
Also read: Crypto Weekly Price Prediction: BTC Consolidated below $90K amid Holiday Season!
