Solana may not hit $200 this cycle, even with bullish signs

SOL has claimed a victory over its rivals with a 10% weekly surge.
However, this doesn’t guarantee a break from consolidation.

As a seasoned researcher with years of experience analyzing cryptocurrency markets, I’ve seen my fair share of bull runs and market consolidations. The recent surge in Solana [SOL] has certainly caught my attention, but it’s important to remember that a 10% weekly gain doesn’t automatically guarantee a break from the current consolidation pattern.

This week, Solana (SOL) has experienced a significant rise of approximately 10%, moving it closer to the important $160 resistance barrier. In the last three months, it’s encountered this level four times but hasn’t been able to break through, encountering rejections each time.

As an analyst, I’m currently focusing my attention on Solana (SOL), given its potential to surge past the significant resistance level at $160. If SOL manages to break through this barrier, it could pave the way for a bullish trend that might propel the price toward the highly sought-after $200 milestone.

The significance of $160

Source : Coinalyze

Since the end of July, Solana’s trading has remained within a narrow band between approximately $110 and $160. Even with Bitcoin experiencing two significant price surges during this timeframe, reaching over $66K, Solana (SOL) has not attracted much additional investment capital.

Despite the challenges, the bullish momentum has held strong for SOL, preventing it from reaching a fresh local bottom. However, this tenacity might not necessarily trigger an immediate surge in prices.

In order for SOL to take a significant step forward, it must successfully breach the current resistance at around $160.

The approximately 10% weekly increase fuels hope, particularly as Solana (SOL) has been surpassing several leading altcoins in performance.

Based on their analysis, the experts at AMBCrypto ponder if investors may soon move funds from Bitcoin to Solana. If this occurs, it could potentially lead to a significant rise for Solana.

Interest in SOL is brewing, but there’s a catch

Constructed with the concept of outperforming Ethereum, Solana boasts a system that enables swifter transactions, managing more than 3,000 transactions per second (TPS) at this time.

Following a rather messy conclusion to the September period, which saw a significant decrease in active wallet numbers from close to half a million to 800,000 within a fortnight, there’s been an influx of liquidity observed in October.

During this time, active wallets reached an ATH.

Source : SolScan

It might come as a surprise that even with these achievements, the price of SOL hasn’t followed the usual pattern. One plausible reason for this could be a hesitation among traders to amass aggressively, as they might not consider the present price level as indicative of a possible floor.

If this trend continues without change, the possibility of a recovery could weaken significantly, as the $160 barrier might yet again go untested – making it the fifth instance in a row.

A recent report from AMBCrypto underscores the escalating action within the futures market, as open interest (OI) surged significantly to reach approximately $2.45 billion. This surge suggests a favorable, bullish forecast for SOL.

Yet, this growth pattern brings about a difficulty, increasing the susceptibility of SOL to abrupt derivative fluctuations. Such instability might wipe out all the progress achieved in the last week once liquidation processes are initiated.

Essentially, Solana (SOL) finds itself at a pivotal juncture. While its current upward trend has maintained a positive position for SOL, there’s a possibility that the price could soon dip and stabilize.

The possible retreat might mainly be caused by investors’ reluctance to buy aggressively, as they appear unsure about seeing the present prices as a good opportunity for investment. Thus, it’s important to exercise caution.

2024-10-20 18:16

Solana may not hit $200 this cycle, even with bullish signs – Why?

The significance of $160

Interest in SOL is brewing, but there’s a catch

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