As a seasoned researcher with over two decades of market analysis under my belt, I’ve witnessed countless bull and bear cycles. The current state of Solana (SOL) has me intrigued, to say the least. With its price teetering on the edge of the critical $100 threshold, it seems like a game of cat and mouse between the bears and the bulls.
By the end of the first week in September, the value of Solana (SOL) had settled at approximately $124, sparking worries among investors due to its potential to drop below the crucial $100 mark, a significant level for the fifth largest cryptocurrency.
As per the analysis by market expert Ali Martinez, if the price of Solana consistently falls below its current support level at $126, it might lead to a substantial price decrease. This drop could extend to around $110, and in some cases, it may even reach $90.
Solana Price Challenges
In a recent social media post, Martinez explained the current market scenario, mentioning that the TD Sequential indicator had earlier given a buy signal on the daily chart. This could potentially lead to a recovery for Solana, moving it from the lower limit of its trading range towards higher prices at around $154 and $187.
Yet, the persistent downtrend in the wider market has undermined this bullish indication, resulting in a decline of around 20% for Solana over the last fortnight and 13% during the previous month.
Although facing difficulties, there’s still a flicker of optimism for Solana’s rebound. Notably, Martinez highlighted a historical trend suggesting that Solana often sees a price surge over the two-week period preceding its “Breakpoint event”.
In 2021, the value of the cryptocurrency rose by 35%. The following year, it experienced another increase of 35%, and in 2023, it jumped up by a remarkable 60%. With just 16 days left until the 2024 “turning point,” an analyst predicts that this upward trend could persist from previous years, potentially leading to a substantial rebound for the token.
If past trends continue, Solana might surge by around 35%, reaching approximately $167. Yet, it may not exceed its current channel’s upper boundary of $187. Importantly, according to Martinez, Solana needs to regain and stabilize above the $126 mark in the near future to prevent any further drops.
Influx of Capital From FTX Creditors And Historically Bullish Q4
In terms of Solana (SOL) investors, it’s worth noting that the fourth quarter following Bitcoin‘s halving often displays optimistic patterns, hinting at a possible market rebound that may favorably impact SOL as well.
Moreover, the defunct cryptocurrency exchange FTX plans to disburse approximately $16 billion in cash to affected creditors due to its downfall. This significant amount may flow back into the market, potentially marking a considerable recovery, especially for four prominent digital currencies.
Analyst OxNobler points out that most of the impacted FTX customers are everyday investors, suggesting that a large chunk of the recouped funds might flow back into the cryptocurrency market.
It’s likely that a significant portion of these funds will be invested in Bitcoin and other leading cryptocurrencies like Ethereum, Solana, and Binance Coin. This injection of capital might not only steady the market but could also offer chances for price rises in these digital assets.
As a researcher, I’m exploring an intriguing possibility here: If this theory holds true, it could potentially serve as a significant catalyst for the crypto market, given the steep declines we’ve witnessed among major cryptocurrencies over the past few months due to heavy selling activities. However, only time will tell if this is indeed accurate.
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2024-09-07 09:40