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Solana (SOL) is staging a potential comeback, rebounding 1% to $187.43 after triggering a TD Sequential buy signal at $178. This technical indicator, widely used to identify trend reversals, has sparked renewed bullish sentiment among traders, especially as SOL consolidates above the key $180 level.
The 4-hour chart shows diminishing bearish momentum, with candlesticks losing strengthan early sign that sellers are losing control. A green arrow under the final bearish candle, coupled with a black arrow confirmation, adds credibility to the bullish thesis.
Solanas Price action is forming higher lows, suggesting strength is building for a possible breakout toward $188$190. However, SOLs bullish narrative is tempered by growing internal tension in the crypto space, especially with growing security concerns.
Community sentiment has turned cautious after warnings from prominent Solana contributor Dean Little. He flagged the risk of Ethereum grifters exploiting Solanas fast and affordable infrastructure for scams, potentially undermining trust and driving away long-term users.
This concern isnt unfounded, Solana has seen its daily active addresses fall by 16% in the past week, with DeFi total value locked (TVL) dipping 8%. Though July was strong, with $9.85B TVL and $82B in DEX volume, signs of cooling engagement have coincided with SOLs price retracing from its $206 high.
Despite the volatility, the TD Sequential buy signal has provided a technical lifeline. SOL is holding the 20-day EMA near $178, a key dynamic support. Retail long positioning has surged, and open interest is rising, suggesting that traders are preparing for a move.
As SOL battles for control above $180, a sustained close above $190 could reignite momentum. Still, with Ethereum-based scams casting a shadow, traders must stay woke. The next few sessions could determine whether Solanas bullish setup leads to a breakout, or succumbs to broader distrust.
Cover image from ChatGPT, SOLUSD chart from Tradingview
