Crypto: Is Solana Ready To Continue Its Rise? Technical Analysis From October 16, 2024

The cryptocurrency market is on the rise, with Solana rebounding 17% in a week. Let’s examine the upcoming prospects for SOL’s price.

Situation of Solana (SOL)

After plunging to around $110 following the overall downturn in the crypto market, Solana has rebounded to reach a new peak around $164. Unfortunately, the crypto has not managed to break this key level despite several attempts. However, it seems that bullish pressure is increasing as SOL’s price forms higher lows. Indeed, we can note the support at $120 and, more recently, at $133. All these fluctuations have formed an “inverse head and shoulders” pattern, a chart pattern suggesting a possible breakout of the resistance.

At the time of writing, the price of Solana is trading around $155. Solana has crossed its annual VWAP as well as its significant value area, both identified at the same level, around $144. The crypto has also surpassed its 50 and 200-day moving averages. Although they are still crossed downward, all these elements leave room for optimism for a resumption of an upward trend. As for Solana’s momentum, it seems to be picking up and supported on the upside, as evidenced by its price and oscillators.

The current technical analysis was conducted in collaboration with Elie FT, an investor and passionate trader in the cryptocurrency market. Currently a trainer at Family Trading, a community of thousands of proprietary traders active since 2017. There, you’ll find Lives, educational content, and mutual aid around financial markets in a professional and warm atmosphere.

Focus on Solana derivatives (SOLUSDT)

The latest rebound of Solana was positively correlated with the open interest of SOL/USDT perpetual contracts, showing a growing interest from speculators, mainly on the buy side. However, the CVD, being stable, shows that selling pressure persists. As for the funding rates, they appear positive, illustrating a majority of buyers on the crypto’s perpetual contracts. Regarding liquidations, they are mostly sellers, which could indicate a recent capitulation of sellers on Solana’s price.

The heatmap of SOL/USDT contract liquidations reveals that Solana’s price is just below a significant liquidation zone, located around $163. Above this area, more subtle liquidations can be noted, notably at $174, then higher at $185 and $194. Below the current price, a liquidation zone is around $144. Finally, lower, there is a significant liquidation zone below $127. The approach of the price to these levels could trigger a massive execution of orders, thus increasing the risk of heightened volatility for the crypto. These areas therefore represent a crucial point of interest for investors.

Forecasts for Solana’s Price (SOL)

• If Solana’s price holds above $133, a bullish continuation up to the $164 level could be anticipated. The next resistance to watch, if the upward movement continues, could be around $170. Beyond that, we can note the levels of $185 and then $194. At this point, it would represent an increase of more than 26%.

• If Solana’s price fails to hold above $133, a return to $126 could be expected. The next support to watch, if the downward movement continues, would be $120. Lower still, we can note the support of $110. At this point, it would represent a decline of approximately 28%.

Conclusion

Solana shows signs of recovery after a downturn phase, with increasing bullish pressure. Although resistances persist, the technical signals and current momentum suggest a potential upward reversal, indicating a possible continuation of the recent bullish move. However, it is crucial to closely monitor the price’s reaction to key levels to validate or revise the current forecasts. Finally, let us remember that this analysis is based solely on technical criteria, and the price of cryptocurrencies can change rapidly due to other more fundamental factors.