SOLUSDT is currently in an uptrend after recently breaking out of its extended downtrend to $95 which took out millions of long positions. Now, we are seeing yet another extended downtrend on the lower time frame, but the overall direction is still up.
Last week, price action printed two very bullish pinbars at the $155 level which could have been considered support, where price was consolidating around late April. High leverage traders entered here and eventually got liquidated last Friday.
Following the liquidity hunt, price reversed quickly, but not strong enough to reclaim the $155 zone. Many of those who were liquidated likely re-entered on this fast move, thinking that the liquidity hunt is over and price cannot move lower.
I am anticipating one FINAL move down to $140 before the uptrend resumes. This will be the move that takes out the dumb money and where smart money will take their positions. The alternative is that the liquidity hunt never happens, and price breaks out of the falling wedge to resume its uptrend.
What about macro and micro factors?
⚖️ Ripple vs SEC Case
On 8th May, both parties agreed to settle, which ignited a massive market-wide rally. Unfortunately, their filings were rejected due to a procedural issue. The next deadline for refiling is on 16th June. Once accepted, we can expect another massive rally.
🤝 US-China Trade Talks
This week, US and China will meet at the negotiation table again. On 12th May, US & China reached a deal in Geneva and sent markets on another rally. IF (big if) they come to another deal this time, we can expect another rally.
✂️ Fed Rate Cut Expectations
The Fed talked about cutting interest rates in late 2025. They are currently in a "wait and see" stance however, due to uncertainties. Eventually we will see a rate cut, and I believe this would be a "buy the rumor, sell the news" event. Markets will price in the anticipated rate cut before it happens later this year.
Our first price target is $250.
Last week, price action printed two very bullish pinbars at the $155 level which could have been considered support, where price was consolidating around late April. High leverage traders entered here and eventually got liquidated last Friday.
Following the liquidity hunt, price reversed quickly, but not strong enough to reclaim the $155 zone. Many of those who were liquidated likely re-entered on this fast move, thinking that the liquidity hunt is over and price cannot move lower.
I am anticipating one FINAL move down to $140 before the uptrend resumes. This will be the move that takes out the dumb money and where smart money will take their positions. The alternative is that the liquidity hunt never happens, and price breaks out of the falling wedge to resume its uptrend.
What about macro and micro factors?
⚖️ Ripple vs SEC Case
On 8th May, both parties agreed to settle, which ignited a massive market-wide rally. Unfortunately, their filings were rejected due to a procedural issue. The next deadline for refiling is on 16th June. Once accepted, we can expect another massive rally.
🤝 US-China Trade Talks
This week, US and China will meet at the negotiation table again. On 12th May, US & China reached a deal in Geneva and sent markets on another rally. IF (big if) they come to another deal this time, we can expect another rally.
✂️ Fed Rate Cut Expectations
The Fed talked about cutting interest rates in late 2025. They are currently in a "wait and see" stance however, due to uncertainties. Eventually we will see a rate cut, and I believe this would be a "buy the rumor, sell the news" event. Markets will price in the anticipated rate cut before it happens later this year.
Our first price target is $250.
Trade active
SOL is breaking out of the wedge with good volume, attempting to reclaim $155 after a slow weekend. On the H4 timeframe we can see that the wedge was retested earlier.If today's candle prints green, we will have 4 consecutive green daily candles- very strong indication that buyers are stepping in. 4 consecutive green daily candles are relatively uncommon, and in most cases precedes rallies.
Bitcoin is also breaking out of its downward channel and reclaiming 107k with strong volume. The pawns (altcoins) will follow the king (Bitcoin).
The further we go from $140, the less likely the final liquidity will take place.
Note
The battle between $160 sellers and $155 buyers is forming a consolidation range. All we need is to overpower the sellers and establish a base at $165, and we're home free going towards $180 and beyond.
I'm willing to bet on the upside as ETH and BTC confluence is hinting at another rally. Very soon we will hear updates from the US-China talks which will be the rocket fuel.
Note
$160 resistance destroyed and we are moving fast to claim $165, powered by reports of SEC's request for spot SOL ETF issuers to update their filings. This indicates development for approval. If this hype keeps up, we could be going straight past the $185 resistance. I believe once the Ripple vs SEC case is settled, possibly late June, approval becomes imminent in the coming weeks.
US-China talks have also produced positive results, creating renewed optimism.
Everything points to an all-out market-wide rally. The final liquidity hunt is now highly unlikely.
Note
And so, it happens against all odds. A few hours ago, Israel launched strikes against Iran, taking SOL diving from $155 to $140. Outlook is becoming increasingly bearish. Will you buy while the markets bleed?
Order cancelled
SOL is printing a bullish engulfing candle, confirming the support level at $140 and reclaiming the $150 level. However, a new downward channel has revealed itself. Ideally, SOL should reclaim the $170 level to confirm the bullish outlook, followed by a close above $190.
We are currently in a chop range between $140 - $180, not an ideal place to go long.
BTC and ETH however, still look very bullish. Alts go where Bitcoin goes. If confluence serves SOL right, this chop range should be over soon. We shall also see if the macro background takes SOL higher or not.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.