Solana
Solana shines brightly: SOL outperforms the market and aims for new highs
Solana (SOL), the native token of the high-speed blockchain network, emerges as one of the pioneers of the recent rebound in the cryptocurrency market. SOL has outperformed most major digital assets and is potentially aiming to regain its cycle highs.
TL;DR
- Solana’s price movements suggest a potentially bullish inverse head and shoulders pattern.
- The $160 level could provide a critical support zone for future gains.
- A successful breakout above $160 could lead SOL to $210, representing a potential 24% increase.
- Monitoring Bitcoin price movements can offer valuable insights for understanding Solana price trends.
SOL rises, outperforming the market
On Friday, SOL hit $170, its highest level in over a month, before settling around $166. That translates to a nearly 7% gain in the past 24 hours and a staggering 40% jump since the broader crypto market crashed in early May, when Bitcoin plummeted to $56,000.
Looking at the weekly performance, Solana reigns supreme. Among members of the CoinDesk 20 Index (CD20), a benchmark for the broader crypto market, SOL’s 17% gain is eclipsed only by Chainlink (LINK), which benefited from a recent announcement of partnership.
Analyst optimistic about SOL’s future
Co-founder of digital asset hedge fund Syncracy Capital, Daniel Choung, expressed immense optimism for SOL in a social media post. He highlighted SOL’s exceptional performance during the rebound and believes it remains “the best deal of this cycle.” Choung forecasts a rise to $200 by the end of the month, potentially followed by new record highs “soon.” It is important to note that SOL’s all-time high of $260 was reached in November 2021.
Several catalysts fueling the rise of SOL
Solana’s momentum is attributed to a confluence of factors. The network is seeing increased meme coin trading, robust stablecoin volumes, and increased DeFi activity. Additionally, Choung highlights upcoming network upgrades paving the way for Firedancer, a sidechain client designed to improve network performance by Jump Crypto.
Growing interest in restoration boosts Solana ecosystem
David Shuttleworth, research partner at Anagram, sees growing interest in “shared cryptoeconomic security,” also known as resttaking, within the Solana ecosystem. Restoration allows users to delegate their staked SOL to validators, potentially earning higher rewards.
Solana retires after weekend break
The overall cryptocurrency market saw a temporary halt to the altcoin rally over the weekend. Bitcoin encountered resistance at $67,500, leading to a slight decline of 0.2%. Solana, despite being the fifth largest cryptocurrency, also fell more than 2% to $169. However, investors view this pullback as a potential entry point, given SOL’s strong performance earlier this month.
Recovery on the horizon for Solana?
The first weeks of May were a bullish period for Solana, with its price rising from $112 to $168, a 50% increase. Although the recent decline may cause temporary concerns, investors remain hopeful for further recovery as the week progresses. Price action suggests a “low” formation, potentially indicating investor accumulation during dips, which could shift market power to buyers.
SOL/USD Technical Indicators Point to Bullish Potential
Solana’s rising price chart hints at an inverse head-and-shoulders pattern, often interpreted as a bullish signal suggesting a potential price floor. If current support levels hold, this technical setup could indicate further gains for the cryptocurrency.
Key support level for SOL
On May 17, Solana price broke above the $160 resistance level, consolidating an uptrend. If this trend continues, a buyer-driven post-breakout rally could propel SOL to $210, translating into a potential 24% increase. However, Bitcoin’s inability to rise above $67,600 introduced some general selling pressure into the market, causing SOL to see an uptick to $169.
This pullback could serve as a test for SOL’s ability to maintain support above $160, establishing a crucial foundation for further price appreciation. Conversely, a price decline below this level could negate the bullish outlook and potentially bring SOL back to $138. Therefore, Solana’s future trajectory depends on its ability to maintain or surpass current support levels.