Solana Consolidates Gains Near $180, Where a Sideways Move Is Expected to Break Out

Solana (SOL) trades with modest gains on Tuesday while nursing the previous day’s loss. The prices lose momentum following the news Solana wallet Phantom acquires a 16z-backed Bitski wallet platform. The momentum oscillator trades above 60 indicate the continuation of the upside momentum after the pullback.

Solana trades in a range-bound manner on Tuesday with a mild bullish bias. However, the formation of a spinning candle suggests a lack of buying interest among traders. As a result is imperative to look for valid buying signals or opportunities before initiating a long position.

As of press time, the SOL/USD pair trades at $180.23 with 1.14% gains. According to data sourced by CoinMarketCap, Solana’s market cap dropped 1% to $80.54 billion following a dip in the price.

Solana’s Technical Insights Point to a Consolidation Ahead with a Bullish Bias.

On the technical front, SOL is in a short-term upside trend after testing the swing low of $118.89 on May 1, 2024. Since then, the price rallied nearly 58% to date. The recent price action suggests a sideways momentum after hitting the high of $188.79 on Wednesday. The Bulls need a breather before they can continue the upside momentum.

The formation of the ascending triangle, which is a neutral pattern, suggests the tug-of-war between bulls and bears. Further, the formation of a small candle following a red candle the previous day pauses the fall in the price in today’s session.

Now, if the bulls can sustain above today’s low of $175.12, there is hope for the price to shoot up toward $180.00 or above. On the downside, Solana could fall toward the low of $167.81 made on the first day of the week.

After making a low of $78.87 in January 2024, the SOL price is in a bullish trend. The momentum intensified above the 21-day Exponential Moving Average (EMA). The rally halted, and the price corrected to $118.89 following a negative divergence in the relative strength index (RSI), which is a momentum oscillator. The price took support near the ascending triangle lower trend line and zoomed at $188.79.

The RSI still trades above 63, far from the overbought zone, suggesting the probability of an upside breakout in the triangle. In that case, the upside target could be the high of March 18 at $210.03. On the contrary, if the price drops, immediate support could be provided at the 21-day EMA.