#SOL bearish Divergence

Bearish RSI divergence is a condition when the price chart forms a higher high, but the RSI indicator forms a lower high, indicating a weakening buying momentum and the potential reversal of the trend from upward to downward, or as an early sign of the end of the upward price trend.

Mechanism:

Price vs. Indicator:

In normal conditions, when the price rises, indicators like RSI will also rise, reflecting the strength of buying momentum.

Bearish Divergence Pattern:

However, in this pattern, there is a discrepancy between price and RSI.

Price: Creates a new higher high compared to before.

RSI: Instead creates a lower high compared to before.

Implication:

This difference indicates that although there is a price increase, the fundamental strength behind the increase has weakened or buying momentum is starting to decrease, signaling that the upward trend is likely to end soon or reverse downward.