SOL's price hits resistance, squeeze potential looms

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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• SOL's Open Interest has increased as price has gone higher, whilst SOL's Funding Rate has turned very negative. This indicates that as the price has moved higher, traders have begun shorting SOL with some size. This level of negative Funding could be slightly vulnerable to a Short squeeze, though. That would be the only point to be wary of from jumping into Short's perspective.

SOL's funding rate:

Technical analysis

• SOL was able to break out of the local downtrend line and reclaim the horizontal level of $120. This has what has helped SOL to break out close to the $148 level.
• $148 is a key horizontal resistance, which may be a stopping zone for the price in the short term.
• If price can get above $148, we'd expect the next level to be the local top ($162), however, we're not confident that price will even reclaim $148.
• To the downside, the main support once again becomes $120, with $98 being the next major level below that.
• The RSI has broken out of its downtrend, but it has put in a hidden bearish divergence, which is a lower high in price and a higher high on the oscillator. This can suggest exhaustion to the upside.

• Next Support: $120
• Next Resistance: $148
• Direction: Bearish
• Upside Target: $148
• Downside Target: $120

Cryptonary's take

We expect in the short term that SOL is close to a local top, with this likely being around the $140 to $148 level. However, if not, then we do expect $162 as a maximum level for a local top, but we're not confident the price gets as high as that.

We are expecting more downside in the medium term, and therefore, we do expect a revisit of the $120 horizontal support. We'll be closely assessing price behaviour at that level, assuming we're right in calling for it.

We're expecting downside in the medium term, and we'll look to accumulate SOL for the long run in the Green Buy Box (between $81 and $112).