Why Solana’s [SOL] next move could surprise you

Solana lags as other alts shine, giving “shorts” the upper hand.
If bulls act swiftly, the tide could turn—but timing is everything.

As a seasoned crypto investor with battle scars from numerous market cycles, I can’t help but feel a sense of déjà vu as I watch Solana [SOL] struggle to regain its footing amidst a sea of surging altcoins. Over the years, I’ve learned that markets often move in mysterious ways, and the current downtrend doesn’t necessarily mean SOL is doomed.

The tenacity of Solana (SOL) supporters is being strongly challenged as the cryptocurrency’s resistance is under pressure. Despite three separate efforts within a month to break away from a descending pattern, the price movement remains difficult and appears to be heading lower still.

Examining its day-to-day graph, it’s evident that the “Trump pump” significantly influenced investors, propelling Solana to an unprecedented peak of $264, marking a new record high following three years of little growth.

Following such a strong surge, you’d think long-time Solana (SOL) holders would choose to sell their assets. However, quite unexpectedly, they are not doing so.

Rather than being driven by speculation, it’s the strong belief of these long-term investors that’s causing anticipation for a quick recovery.

Despite SOL recovering some ground after the elections, it’s now possible to see that those gains have largely vanished, and there’s a growing concern about a potential further decline. Even the strongest long-term investors might start feeling the squeeze soon.

It may only be a matter of time before the weight of this downtrend forces a decision.

The clock is ticking

The chart makes it very obvious who won the election cycle, given the significant changes over a 30-day period.

A week following the announcement of the results, a surge of excitement washed over the market, propelling some investments towards significant increases.

Ripple (XRP) significantly outperforms other cryptocurrencies, surging past a significant milestone and achieving a threefold increase in value. Even more noteworthy is that it has now moved ahead of Solana, securing the position as the fourth largest cryptocurrency in terms of market capitalization.

Clearly, Solana has lagged behind its rivals, but that doesn’t mean all hope is lost.

There’s increasing talk about a significant recovery for SOL, with some analysts suggesting it could reach a price point of $500 by the close of the first quarter of next year.

Considering the recent fluctuations in Solana’s price, especially over the past three weeks, one might find the prediction of a $500 target slightly optimistic or overly ambitious.

However, we can’t overlook the fact that Solana’s volatility has historically paved the way for some big gains. While it’s too early to make any definitive predictions, it’s clear that anything is possible.

So, should you go “long” on Solana?

Over the last three tumultuous weeks, I’ve found myself witnessing a relentless struggle between the bulls and bears regarding SOL. Just when it seemed to have plummeted to $236, the bulls made a remarkable resurgence, fueling an unexpected 5% jump within a mere three-day span.

Intrigued investors rapidly engaged in futures trading, pushing Open Interest (OI) to a record level of $6.05 billion.

Source : Coinglass

But the rally didn’t last, and OI has since dropped to $5.16 billion. So, if you’re “long” on SOL, tread carefully.

Although the current cost looks attractive, Solana (SOL) hasn’t been receiving the same level of interest as other altcoins, which have been capturing more attention lately.

Even so, there’s still a chance. Long-term investors are holding strong, and if influential figures provide a nudge, a short-squeeze might cause a shift in the storyline.

In a market where shorts (people who borrow shares to sell, with the hope of buying them back later at a lower price) have been predominant for some time, their exploitation of weak accumulation might shift the balance towards Solana (SOL).

Time’s ticking, and if the bullish trend doesn’t pick up speed shortly, long-term investors could start losing confidence, which could lead to a drop below $200. This downturn might present a chance for savvy traders to get back in the market.

2024-12-16 05:12

The clock is ticking

So, should you go “long” on Solana?

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