Solana Crypto Signal: Exciting Buying Opportunities in View

Adam Lemon

Dip to $130 or breakout above $150 can be interesting long trades.

Today’s Solana Analysis

Risk 0.50%.

Trades may only be taken before 5pm Tokyo time Thursday 13/01/2022.

Long Trade Ideas

  • Go long following a bullish price action reversal on the H1 timeframe immediately after the next touch of $138.27, $130.00, or following an hourly close above $150.
  • Put the stop loss $3 below the local swing low.
  • Move the stop loss to break even once the trade is $10 in profit.
  • Remove 50% of the position as profit when the price reaches $10 in profit and leave the remainder of the position to ride.

Short Trade Idea

  • Go short following a bearish price action reversal on the H1 timeframe immediately after the next touch of $155.34.
  • Put the stop loss $3 above the local swing high.
  • Move the stop loss to break even once the trade is $10 in profit.
  • Remove 50% of the position as profit when the price reaches $10 in profit and leave the remainder of the position to ride.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

SOL/USD Analysis

It is an exciting time for cryptocurrencies in general right now, and for Solana in particular.

We see the beginning of a potentially bullish environment for this asset class after an extended period of serious decline. Bitcoin seems to be finding support at $40k, and Ethereum at $3k, at the same time. This is a bullish sign.

Turning to Solana, the price reached its 50% retracement from its record high made last year just a few days ago at $130. This may well be a long-term low.

While the price chart below shows a pattern of lower lows and lower highs, the rate of decrease has shallowed greatly, and we start to see what looks like the completion of a bullish over and under / Quasimodo pattern as the low at $138.27 holds. This support level is likely to be extremely important over the short term. If it holds, this will be a bullish sign, and if we get a bullish move soon that finishes with the price established above $150.00 that will be an even stronger bullish sign.

If the support level at $138.27 does not hold, look for the price to continue falling to $130.00 and if there is another firm bullish bounce there, that could be an excellent long-term buying opportunity.

If the price breaks above $150.00 but then fails strongly at $155.34 that could be a good short trade opportunity. Therefore, long-term buyers might prefer to wait for the price to break above $155.34 and not just $150.00 before entering any long trade.

SOL/USD Signal

 

Concerning the USD, there will be a release of US CPI (inflation) data at 1:30pm London time. There is nothing of high importance scheduled today concerning Solana.

 

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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