After the scandal of the $LIBRA launch, and ongoing big unlocks for $SOL, the price plummeted – even briefly going below the bull market trendline. Is this a perfect time to buy, or could the $SOL price fail to recover?
What are the chances that $SOL price will now fall away?
When $SOL went to $8 in the depths of the last bear market, it was a brave soul who was buying it. But those who did, probably knew that the fundamentals for Solana were unchanged. They knew that this layer 1 network had the potential to challenge Ethereum for most of the transactional value across all the layer 1 and 2 blockchains, and their bet paid off handsomely.
Now, once again, $SOL is in trouble. It’s still a long, long way from that $8 bottom, but it did fall through its bull market trendline, albeit very briefly, and with just a couple of daily candle wicks.
Therefore it now needs to be considered. What are the chances that the most serious challenger to Ethereum (if one discards Ripple $XRP and Binance $BNB) will now sink into oblivion?
It just isn’t going to happen. The Solana ecosystem has been doing as much as 75% of the transactional value across the whole of crypto in recent times. On most other metrics, Solana also leads.
Bull market trendline holds
Source: TradingView
The daily chart above shows how the $SOL price has consolidated above the bull market trendline. As long as this remains intact, a bounce to the upside is more likely than not.
It could also be said that the big fall in the $SOL price did confirm the top of the descending trendline, although at a much lower level. It might be expected that the price does start to climb from here, and the major horizontal resistance at $202 will be the target.
Major indicators are signalling a bounce to come
Source: TradingView
The weekly chart for $SOL puts everything into perspective. The bull market trendline looks to be holding, and this is bolstered by the major horizontal support at $174.
Also, at the bottom of the chart, the Relative Strength Index is showing that a bounce of the indicator line from the 46.00 level would be a very bullish move. This level has been both support and resistance since early 2022, and so could provide a bounce.
Just below this indicator, right at the bottom of the chart, is the Stochastic RSI. This momentum indicator is showing that the indicator lines are bottoming. Once they cross back up and cross the 20.00 level, some very powerful upside price momentum should come into the market. This is maybe not the time to write off $SOL.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Credit: Source link
