After being dragged down by the overall crypto market decline, Solana rebounded by more than 45% in three days. Let’s take a look at the future outlook for the SOL price.
Location of Solana (SOL)
When Solana reached its last resistance identified at $190, the crypto market experienced selling pressure which slowed the development of the SOL price. Within one week, the cryptocurrency saw a 45% drop and its price reached $110. Note that this decline was fueled by poor economic performance around the world as well as significant geopolitical tensions. Interestingly, $110 corresponded to a point of interest supported by a significant value zone. So this may explain the buying interest triggered at this level. Even though the price of Solana fell below the $120 support, it quickly moved above this level, which seems encouraging for the future of its price.
At the time of writing, Solana is trading around $155. Interest in buying cryptocurrencies seems persistent. These latest swings have allowed SOL to buck its short-term downtrend. As for the medium-term trend of the cryptocurrency, it still remains bullish, although its price is barely holding on to its 50 and 200-day moving averages. In terms of cryptocurrency dynamics, we can see that it has been declining before rebounding recently. This is reflected in the price of Solano itself and its oscillators. All of these elements naturally leave room for renewed optimism about cryptocurrencies.
SOL/USD daily price chartThe current technical analysis was done in collaboration with Elie FT, a passionate investor and trader in the cryptocurrency market. Today, coach v Family businessa community of thousands of traders on their own account active since 2017. Here you will find lives, educational content and mutual help in the financial markets in a professional and warm atmosphere.
Focus on Solana Derivatives (SOL/USDT)
Solan’s decline led, unsurprisingly, to a reduction in open interest in SOL/USDT perpetual contracts. This shows that speculative interest is being revised downwards during recent swings in cryptocurrencies. A decline in both CVD and funding rates suggests dominant selling sentiment recently. However, we can observe a recovery in the latter, which indicates an imminent renewal of buying interest. In terms of liquidations, there are significant liquidations of long positions, illustrating the recent capitulation of buyers.
A heat map of SOL/USDT contract liquidations over the past three months shows that the liquidation zone identified between $155 and $150 has been breached. Unfortunately, these zones did not attract significant buying interest, given the cryptocurrency’s reaction to them. Now notable liquidation zones are mainly above the current SOL price. There are fine zones at $160, $170 and higher at $180. The most visible area is around $195. A price approaching these levels could lead to massive order triggering, increasing the risk of a period of heightened volatility for Solana. These areas therefore represent a crucial point of interest for investors.
Prerequisites for the Solana Award (SOL)
- If the price of Solana remains above $120, we could expect a bullish continuation to the $170 or even $190 level. Another resistance to consider if the move up continues could be the $205-210 area. In addition, we can note the historical peak of Solana at $260. At this point, that would be an increase of over 67%.
- If the price of Solana fails to hold above $120, we can imagine a return to the $110 levels. Another support to consider if the bearish movement continues will be slightly below $100. Even further down, we can notice support at $86. At this point, that would be a drop of around 45%.
Conclusion
Despite the recent volatility and selling pressure in the crypto market, Solana is showing signs of resilience. The medium-term uptrend remains intact and buyer interest remains strong. These factors are contributing to renewed optimism for cryptocurrencies. However, it will be crucial to closely monitor the price reaction at various key levels to confirm or refute the current assumptions. It is also important to remain alert to potential “false outs” and “market squeeze” in any scenario. Finally, let’s remember that these analyzes are based exclusively on technical criteria and that the price of cryptocurrencies can also develop rapidly depending on other more fundamental factors.
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Family Trading is a proprietary trading community active since 2017 that offers lives, educational content and mutual help in the financial markets including cryptocurrencies with Elie FT, a passionate investor and trader in the crypto market.
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