Since April 23, the price of Solana has fluctuated within a tight trading range, encountering resistance near $153.67 and finding support around $145.68.
The wave of increasing bearish pressure risks breaking this range to the downside, as an important technical indicator is on the verge of confirming a major sell signal.
Solana faces bankruptcy risks as sellers tighten their control
SOL's Moving Average Convergence Divergence (MACD) indicator is preparing to form a death cross, a bearish crossover when the MACD line falls below the signal line.
At the time of writing, the MACD line (green) of the coin is near the signal line (orange), awaiting a catalyst to push it down. This pattern often precedes a prolonged bearish trend and is widely regarded by traders as a sign of weakening price strength.
Furthermore, SOL's Balance of Power (BoP) is currently at a negative level, reinforcing the bearish trend. This indicates that sellers have gained control of the market. At the time of reporting, this figure stands at -0.12.
The BoP indicator measures the strength of buying pressure compared to selling pressure by comparing the closing price with the trading range over a specific period.
When an asset's BoP is positive, it signals that buyers are in control, indicating strong bullish momentum and the potential for continued price increases.
On the other hand, similar to SOL, the negative BoP value indicates that sellers are dominating the market. It shows increasing bearish pressure on SOL and suggests the potential for the start of a new declining phase.
SOL faces a critical support test amidst increasing selling pressure
As bearish momentum increases, SOL risks breaking below the support level at $145.68. A decisive break below this level would confirm a short-term bearish trend and could trigger a deeper decline towards $142.32.
If buyers do not regain control at that moment, SOL could slide further to test lower support levels at $133.94.
However, this bearish outlook could be invalidated if new demand emerges and buying pressure increases significantly. In that bullish scenario, SOL could break through the resistance level at $153.67, opening the door for a rally towards $171.50.