Emerging Reversal Pattern Eyes $42.5 mark

The Solana (SOL) price witnesses an increase of bullish influence over the consolidation range leading to a double bottom at the $31.75 support level. The bullish pattern has a neckline at the $43 mark and shows an increase in the intraday trading volume, reflecting a strong bullish commitment. Will the reversal rally result in the bullish breakout finally reaching the psychological mark of $50?

Key points

SOL price is rising for the third consecutive day
The SOL price is nearing the formation of a double bottom pattern
The 24-hour trading volume in the Solana coin is $1.32 Billion, indicating a % gain

Source-Tradingview

On June 19th, the SOL/USDT pair gave a bullish breakout from a month-long resistance trendline. The breakout rally surged the altcoin by 32%, hitting the $43 resistance. However, the June-end sell-off triggered a minor correction and plummeted the coin to $31.75.

Over the past three weeks, the SOL price has twice retested the $31.75 level, indicating the buyers are defending this support. Moreover, the ongoing consolidation has shaped into a double bottom pattern.

On July 13th, the SOL price rebounded from the $31.75 support, with a bullish engulfing candle accounting for a price jump of 7.24%. This completes the bullish reversal pattern of a double bottom. 

The bullish pattern has a neckline at the $43 mark, which projects a potential price jump of 16% upon breakout. Hence traders can expect the breakout rally to reach the overhead resistance of the $43 mark.

Conversely, a bullish failure to surpass the neckline at $43 would extend the consolidation phase and trigger a retracement to the $31.75 support level.

Technical indicator

The MACD indicator shows the fast and slow lines avoiding multiple bearish crossovers to finally approach the zero line. Moreover, the positive histograms intensify, reflecting an increase in the buying pressure.

Similarly, the Bollinger bands reflect a lateral trend reflecting a contraction phase between $31.75 and $42 horizontal levels. However, the breakout rally from the double bottom can result in a positive trend of Bollinger bands.

Resistance level- $43 and $48.5
Support levels- $31.75 and $25.76