One analyst has explained how Solana could decide its next big move after rising to $210, the resistance level of a parallel channel.
Solana has been operating within a parallel channel recently
in a new mail Over at X, analyst Ali Martinez has talked about what Solana’s trajectory looks like from a technical analysis (TA) pattern perspective. The pattern in question is a parallel channel, which forms whenever the price of an asset trades between two parallel trend lines.
The upper line of the channel is considered a source of resistance, meaning that highs are likely to appear on retests of the channel. Similarly, the lower level is supposed to provide support to the price, helping it reach lows. A break of any of these limits may indicate a continuation of the trend in that direction. That is, a rise above the parallel channel can be a bullish signal, while a fall below can trigger bearish action.
There are a few different types of parallel channels, depending on how the channel is oriented with respect to the chart axes. Channels that have a positive slope are known as Ascending Channels, while those that have a downward slope are called Descending Channels.
In the context of the current topic, the third and simplest type is the one of interest: a Parallel Channel that is also parallel to the time axis. This case corresponds to a phase of true lateral consolidation of the asset.
Now, here is the chart shared by Martínez showing Canal Paralelo that the 4-hour Solana price has been stagnant for the past few weeks:
As shown in the chart above, Solana retested the lower level of the parallel channel last week and successfully found support. Since then, the cryptocurrency has been rising and approaching the resistance level, located at $210. Considering the current trajectory of the coin, the analyst has noted that its price may be heading for a retest of $210 before making its next big move. However, the direction such a move will take, if it comes at all, remains uncertain.
Since the $210 level corresponds to the parallel channel resistance line, it is possible that a retest could reject Solana to the support level around $176. However, it is also possible that this new test could cause a leak. In this case, SOL could naturally see sustained bullish momentum. It now remains to be seen which of the two scenarios will play out for the asset if the Parallel Channel is maintained and retested.
SOL Price
At the time of writing, Solana is trading around $200, up more than 7.5% in the last seven days.
