Is Solana (SOL) Preparing for a New ATH? (Analysts enter)

TL;DR

Solana (SOL) is up roughly 60% YTD and 670% since August 2023, with some analysts predicting significant additional gains. While bullish forecasts abound, certain technical indicators suggest that SOL could face near-term corrections.

.

SOL Heading For Cool Peaks?

Solana (SOL) has been one of the top performing cryptocurrencies in recent months. It entered the year around $105, but quickly soared to more than $200 amid the market-wide bull run in March. Despite losing some traction since then and currently trading at $155, SOL has gained 670% since last August when it struggled at $25.

Price SOL, Source: CoinGecko

Some industry participants believe another major increase could be in the offing. User X Jelle stated that the asset “looks poised for price discovery”, setting a target of $450-$600 for this cycle.

Curbo was even more bullish, hoping for a short-term rally to $400-500 before advancing to $1,000. The crypto enthusiast based the forecast on SOL’s consolidation in the $120-$210 zone over the past six months.

“When this consolidation finally breaks, the move will be MASSIVE,” user X suggested.

Kingpin Crypto also chimed in, stating that SOL currently appears to be in a Long Term Futures (LTF) continuation. “I’d like to see what happens after a low sweep on Monday. Ideally a long-term setup,” they added.

LTF emphasizes the long-term outlook of a cryptocurrency, based on a combination of technical analysis, thorough research and an understanding of market sentiment. This approach is best suited for investors who are less concerned with short-term price dynamics and who focus on the long-term trajectory of their investments.

What do the indicators suggest?

Despite some analysts’ bullish forecasts, certain metrics indicate SOL bulls could be in for some near-term pain.

The Relative Strength Index (RSI), an analysis tool that measures the speed and change of price movements, ranges from 0 to 100. A ratio above 70 indicates that the asset is overbought and could be headed to a fix soon. The index surpassed this level a few days ago and is currently hovering around 60.

The Stochastic Oscillator is another metric used to identify overbought or oversold conditions in a market. It ranges between 0 and 80, with a reading above 80 usually interpreted as overbought territory that could lead to a possible decline in the price of the underlying asset. According to CryptoQuant, the stochastic tool is currently pointing at 81.4.

Separately, we’ll talk about Solana’s open interest, which has been increasing in recent weeks. Currently, the figure is close to $2 billion, a 55% increase compared to the figure seen during the crypto market crash on August 5th.

Open interest refers to the total number of outstanding derivative contracts, such as futures or options, that have not yet been settled. It includes both long and short positions, and its increase could be a precursor to greater volatility and substantial price movement in either direction.

SPECIAL OFFER (Sponsored) Binance Free $600 (Exclusive to CryptoPotato): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

2024 LIMITED OFFER on BYDFi Exchange – Up to $2888 Welcome Reward, Use this link to register and open a 100 USDT-M position for free!