Solana (SOL/USD) finds itself at a critical technical juncture as the cryptocurrency appears to be forming a potential double top pattern near the $180 resistance level.
Currently trading around $173.76, SOL has been unable to sustain a decisive break above the previous highs established in mid-May, suggesting that selling pressure is intensifying at these elevated levels.
The double top formation, characterized by two peaks at approximately the same price level separated by a modest decline, is considered a bearish reversal pattern that could signal the end of the recent uptrend. The pattern’s neckline support sits around the $165-$167 area, representing a critical level that bulls must defend to prevent a more significant correction.
Should Solana break below this neckline support with conviction, the measured move target would project a decline toward the $150-$155 zone, representing a drop equal to the distance between the peaks and the neckline.
However, the pattern remains incomplete until a definitive break occurs, and SOL could still invalidate this bearish setup with a strong push above the $180-190 resistance level.
Conflicting Moving Average Signals
The moving average structure on Solana’s chart presents a mixed technical picture that reflects the current uncertainty in price direction. The 100-period simple moving average (blue line) continues to trend higher and currently provides dynamic support around $173, just below the current price action. This shorter-term average has been instrumental in supporting Solana during recent pullbacks and remains a key level to monitor.
However, the 200-period SMA (red line) is positioned lower at approximately $155, creating a significant gap between the two indicators. While the 100 SMA remains above the 200 SMA in a bullish configuration, the distance between these averages has been narrowing in recent sessions, suggesting that bullish momentum may be waning.
The ascending trend line that has supported Solana’s advance since early April sits around $165, coinciding closely with the potential double top neckline. This confluence of technical support levels makes the $165-$167 zone particularly significant, as a break below this area would violate multiple support structures simultaneously and likely trigger accelerated selling.
Oscillator Momentum Divergence
Momentum indicators are providing early warning signals that suggest Solana’s uptrend may be losing steam. The stochastic oscillator has been making lower highs even as price tested the previous peaks, creating a bearish divergence that often precedes trend reversals. This divergence indicates that buying pressure has been diminishing during recent rallies, despite price maintaining elevated levels.
The oscillator is currently retreating from overbought territory, suggesting that sellers are beginning to gain the upper hand. Should the stochastic continue declining and break below the 50 level, it would confirm increasing bearish momentum.
The MACD indicator is also showing signs of weakening bullish momentum, with the histogram bars contracting and the signal lines beginning to converge near their recent highs. While the MACD remains in positive territory, the lack of momentum expansion during the recent test of resistance levels is concerning for bulls and suggests that the uptrend may be exhausting itself.
