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(This is NFA, please DYOR)
Since the last update, $SOL has reached a recent low price of $85, marking more than a 30% drawdown from the current cycle top at $126. This is a significant retracement, and is exactly the type of market action we want to avoid, in order to hold onto the profits already made.
The first chart I would like to share with you illustrates an effective trading signal. Typically after 7 or more consecutive bars in a swing, in either direction, you can expect to see at least pause in the current trend, and often a trend reversal. Each number below marks the number of bars in that particular swing, and the subsequent price movement. As you can see, the percentage moves following this signal are not to be sniffed at.
Anyways, onto some $SOL analysis! The market is definitely trending downwards; consecutive lower swing highs and lows. $SOL / $USD has now failed three times to get above the Ichimoku cloud on the 4H timeframe, indicating further bearing price action for the short term.
As we continue in this direction, it is important to look at potential support areas to the downside. One key area I have identified is the 50% level, from the cycle low of $8 to the high of $126. This happens to fall at about $67, and has previously acted as S+R, (shown by the yellow circles). Therefore, should we continue downwards, I will look to this level for a potential consolidation and reversal.
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Should this play out, and we reach $67, I will start to DCA into $SOL, increasing the amount as and if it approaches my worst case scenario at $38.
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I am still holding the view that I expressed in the previous thread. An intermediate top, which now looks likely at $126, and then a major correction of up to 70% over ~70 days before reaching new cycle highs through the rest of the year and into 2025.
Thanks for reading! If you enjoyed this, drop a follow on X and Telegram to stay in the loop.
As always, stay safe and bullish,
ChefGunny.
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