Is SOL set to plunge as the bullish neckline snaps?

We may get a retest of $52. If broken, SOL likely tests $48 - a key level.

Disclaimer: Not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results. “One Glance” by Cryptonary sometimes uses the RR trading tool to help you quickly understand our analysis. They are not signals, and they are not financial advice.

Technical analysis

• SOL is currently rebounding from the $52 support. We see a retest of this level as likely, and it's pivotal for SOL to defend the main uptrend line. • If the $52 area is lost, price likely sinks to $48.
• The local resistance is at $55 to $56.40. On the 4hr, it looks to be getting rejected. This is the first battle for bulls to win if they want to see further upside. 
• The RSI on all timeframes, except the 3D and the Weekly, have reset substantially, indicating that the market is far less overbought than it was a week ago. 

Market mechanics 

• The level of Open Interest has pulled back substantially, from $933m 6 days ago to $655m today. But this is still arguably somewhat overheated, particularly when comparing it to prior months. 
• The Funding Rate has remained between 0.006% and 0.010%, indicating a healthy balance between Longs and Shorts, with the overall bias amongst traders to be Long. Overall, this is a healthy setup from a mechanics perspective. 

Cryptonary's take 

SOL has responded well having bounced from the support of the uptrend line and the horizontal level of $52. 

However, it now finds resistance between $55 and $56.40, and with Bitcoin seeming to struggle to push higher, it's becoming more likely Bitcoin will retest it's $35,600 support and this could drag the market down with it. 

This could bring SOL down to $52. In terms of upside, if $56 is cleared, then $61 is the target, but we think there can still be a further pullback here. 

We remain DCA buyers of SOL if price pulls back to $48, with our DCA buys becoming more aggressive sub $44. 

We will look to hold these positions for 12-18 months.