Welcome to the LuckySevenTrader community! Let’s dive into my technical analysis of #SOL/USDT. for a mid-term outlook. Please note, this is based on historical market behavior, so be sure to do your own research before making any trading decisions.
4-Hour Timeframe Analysis
Starting from the 4-hour timeframe, the price action on September 7th shows SOL taking support from the demand zone around 120, leading to an upward movement with the formation of higher highs and higher lows. After establishing a higher high, the price found support around 127, forming a trendline that has served as a springboard for a 26.5% price increase, highlighted with a yellow circle.
The price then reached 160, where it consolidated for a few days between 150 and 160 before eventually falling back to the major trendline support (the blue trendline). At this level, SOL took support around 133 and rallied by almost 14% up to the daily fair value gap, marked with a blue parallel line. This area also aligns with the 0.618 Fibonacci level, marked with a red arrow (swing high) and a green arrow (swing low).
My Analysis and Trading Plan
In my view, the price has filled the pending orders at the daily fair value gap and is facing resistance at the 0.618 Fibonacci level (around 150). Given this scenario, there is a high probability that the price will continue to move downward, potentially retesting the major trendline support or even dropping further.
Here’s my trading plan for a mid-term short position:
Entry Point: 150.87 (0.618 Fibonacci level)
Stop Loss: 156.87 (slightly above the 0.786 Fibonacci level)
Take Profit: 115.48
This setup provides a Risk to Reward Ratio of 1:5.9, which is favorable. However, I recommend only entering after confirmation and being mindful of price reactions at key levels. If the price does not respect these levels, a trend reversal could occur, so it's important to manage your trades carefully.
Remember: Always trade with caution and stay safe. Let’s see how this plays out!
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