SOL → Solana Double Top Reversal!? Are We Going to $40 or $80?Solana is struggling at Previous Resistance showing signs that a major reversal is near. If the price fails at this level and leaves a raging red bear candle, what does that mean for the next trade?
How do we trade this? 🤔
There are two ways to handle this chart, short scalp or wait to long. We cannot long at resistance, the Risk/Reward AND Probability are all bad, best to wait for a pullback to the 30EMA and look for a bounce. The RSI is above the Moving Average, but also over 61.00 and given the other data points, is weak evidence to support a long position.
It may be reasonable to short-scalp this chart with a 1:1 Risk/Reward Ratio, entering the market on a smaller timeframe of the 1HR or 4HR chart looking for a bear confirmation candle. Scalp to the $52.35 area then move your stop up to the entry price, take another profit somewhere below the Daily 30EMA or whenever you see a bull reversal bar. This trade has a lower probability on this chart because we technically don't have a bear confirmation candle, which is why I recommend playing a smaller timeframe for a scalp and maybe swing the rest.
Wait on the sidelines for a long. The Alt market is still relatively weak even though Bitcoin is showing some nice bullish price action, so we really need bullish confirmation candles to justify entering the market.
💡 Trade Idea 💡
Short Entry: $61.50
🟥 Stop Loss: $69.65
✅ Take Profit #1: $52.35
✅ Take Profit #2: $45.20
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. Breakout to Downside of Bull Channel, Bias to Short.
2. Bear Breakout, Watch for Sell Signal.
3. Potential Double Top at Previous Resistance.
4. Still Above 30EMA, Watch for Support.
5. RSI at 61.00, above Moving Average. Bias to Long.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
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