Market Overview: Solana/Yen (SOLJPY) – Bullish Rally with Volatility and Reversal Risks

• • •

• SOLJPY surged past ¥30,000, peaking at ¥30,801 before retracing, showing strong bullish momentum.
• Key support at ¥29,900–¥30,000 held briefly but failed to prevent further pullback into the evening.
• High volume spikes in the ¥30,500–¥30,800 range suggest increased interest but also a potential reversal risk.
• RSI reached overbought territory, signaling caution for near-term corrections despite the strong rally.
• Bollinger Bands widened, reflecting elevated volatility, with price currently near the upper band on the 15-minute chart.

Price Action and Volatility

At 12:00 ET – 1, Solana/Yen opened at ¥29,408 and surged to a high of ¥30,801 by 12:00 ET, before closing at ¥30,502. Total traded volume amounted to 7,584.617 units, while notional turnover reached ¥230,773,036. The price action featured a sharp bullish thrust, followed by consolidation and pullbacks, indicating strong institutional or large-cap participation during the daytime session.

Structure & Formations

The candlestick pattern displayed a bullish breakout structure from a prior resistance zone of ¥30,000–¥30,500. A hammer formation was observed near the ¥30,500 level, followed by a bearish engulfing pattern around ¥30,800, suggesting a possible near-term reversal. Key support levels include ¥30,000 and ¥29,900, with the 61.8% Fibonacci retracement of the ¥29,356–¥30,801 move at ¥30,129 potentially offering a reentry point for longs.

Technical Indicators and Momentum

The RSI reached overbought levels (70+) in the late night hours, indicating potential for a short-term pullback. MACD showed a bullish divergence in the late morning session, with the histogram expanding during the rally, but it has since flattened. Bollinger Bands have expanded significantly, reflecting heightened volatility, with price near the upper band, suggesting overextension.

The 20- and 50-period moving averages on the 15-minute chart are aligned bullish, but price has since crossed below the 50-period line, indicating a temporary weakening of momentum. On a daily chart, the 50/100/200 MA lines remain bullish, suggesting the longer-term trend remains intact.

Volume and Turnover Analysis

Volume spiked during the ¥30,500–¥30,800 rally, with a peak of 173.313 units during the 22:15–22:30 ET session, suggesting accumulation. However, volume has since declined during the pullback, raising concerns about a lack of follow-through buying. Notional turnover also rose sharply during the bullish phase but has not confirmed the continuation of the rally, pointing to a potential near-term reversal.

Divergence between price and volume suggests a possible top formation. Investors should monitor if price holds above ¥30,200 to confirm strength or if it breaks below ¥30,000 to signal a deeper correction.

Backtest Hypothesis

A potential backtesting strategy involves entering long positions on a breakout of the upper Bollinger Band combined with a bullish divergence in the MACD and volume confirmation. Stops would be placed below the 61.8% Fibonacci level at ¥30,129, with a target at the 78.6% level around ¥30,700. This approach leverages volatility expansion and momentum confirmation, aligning with the patterns observed during the ¥30,500–¥30,800 rally.