Solana (SOL) price is on the brink of jumping a whopping 35%, as the only element that stands between the bulls and those gains is the longer-term ascending orange trend line, currently playing hard to break. On Tuesday, a false break above triggered a squeeze and bull trap. On Thursday bulls are back knocking on the door of the same trend line, looking to pop above it with just one extra $1 to cross at the time of writing. Breaking above this level could trigger a massive buy-frenzy, with bulls trying to be part of this bullish breakout, and price action running up towards $50.
Solana price is on the cusp of giving bears a knee jerk reaction as bulls are drumming at the gates from the orange ascending trend line. A Black Friday sale springs to mind, as a breakout above that long-term trend line would spark massive buying momentum, with bulls jumping on every price in sight to be part of the rally towards $50. With that buy-side demand overweighting the offers, expect to see some bears closing out their positions and possibly bringing SOL price to the edge of the current downtrend.
SOL price thus only needs an extra $1 to jump to $37.70 and pop back above the orange ascending trend line. This indicator formed a bull trap earlier this week, but the current market diversion between cryptocurrencies and global markets could avoid a repetition of this pattern and see a solid rally into the $40s. If this sentiment continues towards the weekend, the 55-day Simple Moving Average at $50 comes into play as the first cap to the upside, muting price action for further gains.
SOL/USD daily chart
A simple repetition of Tuesday could hurt bulls in their attempt and see them trapped yet again. With investors fed up, losing money on trades that go nowhere and only return losses, it is feasible to see a scenario where bulls leave the scene and trigger an initial drop back to $30 and subsequent $25 in a tiered path to the downside. That would result in a roughly 27% drop and back to the lows of 2022.