SOL’s Spike Rejected: Fading the Pop into 139 with Eyes on 134–135 Reversion

Executive summary

• Bias next 24h: Mildly bearish-to-range after a failed breakout and heavy upper wick rejection. Expect a drift toward 134–135 before stabilizing; range 133–141 probable.
• Trade idea: Fade the pop into 138.5–139.2 resistance (Sell/short), target the 50–61.8% retracement cluster 136.7–134.3; base case take-profit 134.4 within 24h.

1. Market structure and trend (multi-timeframe)

• Higher time frame (daily): SOL has been in a persistent downtrend since mid-September (~250 down to ~127–146 band). Lower highs and lower lows remain intact. The 50/100/200-day MAs (directionally) are still above price and sloping down, confirming a primary bearish regime. Short-term bounce since the Dec 1 low (126.71) leaves price below HTF resistances.
• Intermediate (swing) context: Rally from 126.71 to 146.72 (Dec 1–4) retraced to 133.28 (Dec 5–8), then today spiked to 144.48 and was rejected, closing back near 137. This is a classic “failed breakout / bull-trap” behavior under a dominant downtrend line.
• Intraday (hourly today): Tight Asian/EU range ~132–133, impulsive breakout 15:00–16:00 to 144 area on high volume, then steady distribution and fade to 137.2. Price is now below intraday VWAP and below the 140–144 supply block carved during the spike.

2. Key levels: support and resistance map

• Resistance: 139.1 (38.2% retracement from 126.71→146.72), 140.0 round, 142.25 (pivot R2 from 12/8), 144–146 (intraday spike supply and prior swing highs), 145.3–145.7 (R3 / prior daily high cluster).
• Support: 136.7 (50% retracement), 135.3 (approx 20D SMA), 134.3 (61.8% retracement), 133.3 (recent daily closes and intraday base), 130.2 (pivot S1), 127.2 (pivot S2), 126.7 (Dec 1 swing low).
• Volume profile (qualitative): Acceptance built 132–134 zone; rejection and light acceptance 140–144. Expect mean reversion toward value near 134–136 unless momentum reclaims 140.

3. Moving averages (trend filters)

• 20D SMA ≈ 135.3 (price slightly above): short-term neutrality/early recovery.
• 50D/100D/200D SMAs (directionally): Above price, downward slope → macro trend down; rallies likely sold unless proven otherwise.
• Intraday EMAs (hourly): Post-spike roll-over with price below fast EMAs; indicates intraday momentum has shifted back to sellers.

4. Momentum oscillators

• Daily RSI(14) estimate ≈ 45 (neutral-bearish). Off oversold but not yet bullish; points to range or mild downside.
• Hourly RSI: Spiked >70 on the breakout; now cooled to mid-40s/low-50s during the fade → supports further consolidation-to-drift lower.
• Stochastic (daily, qualitative): Crossing down from mid-high region after the upper-wick day; near-term bearish momentum signal.
• MACD (daily, qualitative): Below zero or hovering near it; histogram recovery stalled by today’s rejection. No confirmed bullish cross domination yet.

5. Volatility and ATR

• Daily ATR(14) rough ≈ 7–8. Expected 24h envelope from 137 is roughly 129–145. Plan for 3–6 points intraday swings; 8–10 only if volatility expands again.
• Bollinger Bands (20D): Mid-band near 135.3; upper est ~147, lower est ~123. Price slightly above mid-band after rejecting near the mid/upper zone → suggests mean reversion toward the middle (135 area) is likely.

6. Ichimoku (daily, approximate)

• Tenkan (9) ≈ (recent 9H + 9L)/2 ≈ (146.7 + 126.7)/2 ≈ 136.7 → price hovering just above/around Tenkan; often a bounce zone, but a close below invites a test of Kijun.
• Kijun (26) likely ~138–140 region; price under Kijun and under cloud bias → rallies face resistance at 139–141 unless momentum improves. Tenkan below Kijun and price below cloud = bearish context.

7. Fibonacci framework (swing from 126.71 to 146.72)

• 38.2%: 139.08 (today’s fade broke below; now resistance)
• 50%: 136.71 (current magnet/support)
• 61.8%: 134.34 (next high-probability support if 50% fails)
• Confluence: 20D SMA ~135.3 sits between 50% and 61.8% → attractive demand cluster 134.3–136.7 for profit-taking on shorts and responsive buying.

8. Pivots (based on 12/8 H/L/C = 139.207/131.675/133.278)

• Pivot P = 134.72; R1 = 137.77; R2 = 142.25; R3 = 145.30; S1 = 130.23; S2 = 127.19; S3 = 122.70.
• Today’s high tagged just under R3, then reversed. Current price ~137.2 around R1. Typical mean reversion flows from R1 back to P (134.7) after a failed R2/R3 extension.

9. VWAP and anchored VWAP

• Session VWAP (intraday): Likely around 140–141 given heavy 16:00 volume near 144. Price below VWAP signals intraday distribution; rallies toward VWAP likely sold.
• Anchored VWAP from Dec 1 low (126.71): Roughly in the 137–139 area now. Current price near/below it → no clean control by buyers.

10. Candles and patterns

• Daily (forming): Long upper wick after a surge to ~144.5 then close back to ~137 → bearish rejection/“shooting star” type context inside a larger downtrend.
• Hourly: Expansion bars 15:00–16:00, then lower highs/lows with declining closes; a classic bull-trap fade. No confirmed basing yet above 136.
• Pattern view: Attempted ascending structure off 126.7 low failed at supply. Absence of a higher-high close vs prior daily high keeps the lower-high pattern intact.

11. Order flow and volume clues

• Breakout bars carried strong volume; subsequent selloff on respectable but lighter volume indicates responsive sellers overwhelming momentum longs. The 140–144 pocket likely remains a supply overhang in the next 24h.
• OBV (qualitative): Not breaking out ahead of price; no bullish divergence confirmed.

12. Elliott wave (heuristic)

• Wave 1: 126.7→146.7; Wave 2: 146.7→133.3; Today’s push could have been a Wave 3 attempt but failure at 144 and deep fade suggests the impulse stalled; a flat/triangle for a larger Wave 2 alternate still plausible. Expect a test of 134–136 for resolution.

13. Risk matrix and scenarios (24h)

• Base case (≈60%): Rebound attempts into 138.5–139.2 fail; drift to 136.7 (50% fib/tenkan) and probe 134.3–135.3 (61.8%/20D SMA/pivot P). Expected range 133.8–139.8; settlement 134.5–136.
• Bull case (≈25%): Strong reclaim of 139.1 and sustained hold above 140/VWAP drives a retest of 142.2 (R2). Follow-through could stretch to 144–145 if volume re-expands. Invalidation above 145.3 daily close would challenge the downtrend line.
• Bear case (≈15%): Clean break below 133.8 triggers momentum to 130.2 (S1) and possibly 127.2 (S2). Requires broad crypto risk-off or fresh negative catalyst.

14. Strategy synthesis and trade plan

• Why Sell the pop: Macro downtrend, daily upper-wick rejection just beneath major resistance, price back below 139.1 fib and intraday VWAP, oscillators rolling over from neutral, and pivot structure favors mean reversion from R1 toward pivot.
• Optimal entry: Short into 138.5–139.2 supply (prior intraday shelf + fib 38.2 + under-VWAP). That gives favorable R:R toward 134–135 supports.
• Targeting: Base TP at 134.4 (near fib 61.8/20D SMA cluster edge and pivot P ≈ 134.7) within 24h. Stretch TP 133.6 if momentum accelerates.
• Risk management (informational): Invalidation on strong reclaim/hold above 140.6–141.0 (back over VWAP and inside supply), with hard fail above 142.3–143.0 (R2 zone). Suggested protective stop for planning purposes: 141.2–141.6 depending on fill quality; R:R ~1:1.5–1:2 to base TP.

15. Timing considerations

• Into Asia/early EU: fade bounces as liquidity is thinner; sellers can pressure toward 135 area.
• Into US: If BTC/majors stabilize and SOL reclaims 140, reassess; otherwise expect further probing of 134–136.

16. What would change my mind

• High-volume reclaim and hold above 140–141 followed by an hourly higher-high >142.3 would invalidate the short bias and open a path to 144–145.

Conclusion

• The combination of a macro downtrend, a failed breakout with a long upper wick, price slipping back under the 38.2% fib and intraday VWAP, and pivot dynamics argues for a Sell-the-bounce approach. Aim to enter near 138.9 and target 134.4 within the next 24 hours.