SOL: Fade the Bounce — Set Up for a Sub-180 Liquidity Sweep

Executive summary

• Thesis (next 24h): Primary expectation is a weak relief bounce into 185.5–188.5, then continuation lower to sweep the 178–180 liquidity zone, with risk of extension toward 175. Shorting the bounce offers best R:R in a still-bearish short-term trend.
• Bias: Bearish for 24h; structure of lower highs and accelerating downside momentum on intraday. Daily trend is corrective-to-bearish below key MAs and below recent range mid.

Multi-timeframe market structure

• Higher timeframe (daily): After peaking near 253 (Sep 18), SOL formed a lower high cluster around 241–248 (Sep 12–18), then a decisive breakdown (Sep 22–25) and a failed recovery into the 221–236 zone (Oct 1–6). The Oct 10 shock move to ~174 triggered a fast mean-reversion up to ~208–205 (Oct 13–27), but that rally failed to reclaim the Sept breakdown area. Since Oct 26–29, price has printed lower highs (200.03 → 198.74 → 197.98) and lower lows (189.75 → 185.67 → 181.63 today). Structure remains a descending sequence under supply.
• Medium/short timeframe (hourly): Today shows a clean sequence of lower highs and lower lows. Notable pivot breaks: 195.8 → 192.8 → 187.6 → 184.8 → 181.4. Heavy sell volume at 12:00 and 04:00 UTC confirmed supply. Into the close, minor stabilization around 180.5–181.6 but no structural reversal.

Key levels (derived from daily and intraday pivots)

• Support/liquidity
  • 182/180: prior close (Oct 22) and today’s session low zone; high-liquidity shelf.
  • 179.2: intraday low cluster (19:00–20:00 UTC prints); a clear stop pocket below.
  • 175–174: shock low zone (Oct 10–11); next target if 179 fails.
• Resistance/supply
  • 185.5–186.5: first intraday supply from breakdown base (15:00–17:00 UTC); likely retest area on bounce.
  • 188–190: composite resistance from 10/18–10/21 price acceptance and today’s morning shelf (07:00–10:00 UTC).
  • 194–196: failed top zone of 10/29–10/30; confluence with short MAs; strong cap if reached.
  • 200–201.7: rejected twice (10/27 and 10/29 highs); unlikely in next 24h unless a squeeze.

Trend and moving averages

• Daily 20D EMA/SMA (approx): Price is below the 20D mean (low 190s), reflecting short-term downtrend. Rejection near that band on 10/28–10/29 aligns with a mean-reversion sell zone.
• Daily 50D SMA (approx 205–210): Well above; trend medium-term is down/neutral-to-bearish.
• Hourly EMAs (8/21): Bearishly stacked and fanning down; every test of 21-EMA today sold.
• Conclusion: Until price reclaims 190–196, rallies are sells.

Momentum oscillators

• RSI (14)
  • Daily: Sloped down from neutral to sub-50 after the Oct 27 failure; not deeply oversold on daily, leaving room for further downside.
  • Hourly: Reached oversold during the mid-day flush (12:00 UTC), modestly recovering into close. This supports a modest bounce before continuation lower.
• MACD
  • Daily: Bearish crossover rolled over again post-10/27; histogram expanding negative = risk of follow-through.
  • Hourly: Deeply negative, slight flattening late session indicates bounce risk but no bullish cross yet.
• Stochastic (hourly): Oversold hook-up likely; typical in bear phases to give shallow bounces that fail under resistance.

Volatility and ranges

• ATR (daily, est 10–12): Implies 5–7% typical daily swing; a 9–12 dollar move is feasible over 24h.
• Bollinger Bands (20D): Price migrating toward/near lower band; on hourly, persistent band-walk lower. Expect brief mean reversion toward mid-band on intraday before another push down.

Volume and participation

• Intraday: Notable sell-side activity at 04:00 and 12:00 UTC spikes – breakdown confirmation. Later hours had lighter volume into close, typical for pause before next leg.
• OBV (qualitative): Rolling over with price; no positive divergence.
• VPVR (qualitative, recent month): High volume nodes around 188–194; price now below these, implying overhead supply should cap bounces. Limited acceptance below 182 suggests whipsaws, but once 179 fails, vacuum toward 175.

Ichimoku (contextual)

• Daily: Price below Tenkan and Kijun, with Kumo above. Bearish configuration; rallies to Kijun (high 190s) likely sold.
• Hourly: Below cloud, span lines angled down; initial resistance matches 186–190 zone.

Fibonacci mapping

• Swing Oct 22 low (~180.15) to Oct 27 high (~205.02):
  • 61.8% ≈ 189.0 (broken today); 78.6% ≈ 184.0 (tested). Loss of 78.6% suggests full retrace to 180 and potential undercut.
• Larger swing Sep 18 high (~253) to Oct 11 low (~173.75):
  • 38.2% ≈ 204 (precise rejection cluster into Oct 27–29). Bears control under 204.

Pattern diagnostics

• Intraday descending channel / bear flag resolves lower this afternoon; structure intact.
• No durable reversal candle on daily; 10/30 is a wide-range red day closing near lows.
• Liquidity/stop-run watch: A quick undercut of 179–180 followed by a wick is likely before any meaningful bounce; failing that, 175 magnet.

Order flow, liquidity, and VWAP

• Price traded below session VWAP most of the day; repeated rejections when attempting VWAP reclaim – a hallmark of trend-down days.
• Liquidity rests below 179 (recent swing lows); above, resting offers likely stack at 186–188 from trapped longs.

ADX/Trend quality (qualitative)

• Short-term ADX rising as the down leg accelerates. Trend strength sufficient to fade bounces.

Elliott wave lens (heuristic)

• ABC corrective up into Oct 27 appears complete; current leg is impulsive down (C or 3) targeting 175–176 to complete symmetry with the Oct 10 leg.

Scenarios next 24 hours

• Primary (60%): Relief bounce to 185.5–188.5 supplied, then rollover to 178–180 sweep; extension to 175–176 if momentum persists.
• Secondary (25%): Direct drift lower from current without full bounce; tag 179–178, small rebound late session.
• Squeeze risk (15%): Strong reclaim >190 on volume triggers squeeze toward 194–196; broader trend still likely sells there unless daily close >196–198.

Trade plan (short bias)

• Entry: Prefer patience for a pop into 186.5 (±0.8) to sell strength at prior breakdown supply and hourly 21-EMA proximity.
• Target: 176.2 (liquidity pocket just below the 10/17–10/22 cluster and ahead of 174–175 shock zone) within 24h.
• Invalidation: Sustained reclaim and acceptance above 190.6 (hourly closes) weakens the short; above 196 invalidates the 24h idea.
• Notes: If no bounce, an alternate momentum entry is a breakdown add below 179.2 with similar target; however, the optimal R:R remains sell-the-bounce.

Why not long here?

• Catching the knife at 181–182 may produce a $4–6 pop, but risk of slipping to 175 is non-trivial, and higher timeframe MAs overhead increase supply risk. The asymmetric opportunity lies in fading the bounce.

Conclusion

• Short-term trend is down with overhead supply and momentum confirming. Expect a reflexive bounce to 186–188 that fails, leading to a sweep of sub-180. Optimal action: Sell (short) a bounce; target mid-170s. Reassess if >190.6 holds.