Solana (SOL) is currently navigating a persistent downtrend, mirroring the instability in the broader cryptocurrency market. Over the past month, SOL has decreased in value by 16%, and in the last 24 hours, it has dropped by 1.6%, now hovering around $141. This decline is coupled with a 42% reduction in trading volume.
Despite these challenges, industry experts remain optimistic about Solana’s future. Raoul Pal, CEO of Real Vision, predicts it will lead the crypto market into a new bull phase. Pal has allocated 90% of his crypto portfolio to SOL, citing two critical factors for his bullish stance: NFT compression and Firedancer.
NFT compression offers low-cost, scalable, non-fungible tokens with broad applications across various sectors. Firedancer, a third-party validation software, aims to enhance Solana’s speed, scalability, and efficiency. These innovations could bolster its position and potentially reverse its current downtrend.
Bullish Outlook for Solana
Crypto analyst XForceGlobal also supports Solana’s bullish outlook through his technical analysis. He highlights two primary structures shaping Solana’s price action: the WXY pattern and a possible triangle formation. The WXY pattern, nearing its resolution, suggests a prospective upward trend.
The WXY pattern consists of three corrective waves, indicating complex price behavior but often preceding significant price movements. Alternatively, the potential triangle formation, a classic technical analysis structure, signals the continuation of the prevailing trend, which could mean an upward surge for SOL.
The timing of this potential rally is projected around September to October. During this period, Solana could complete its fifth wave, a crucial phase in the Elliott Wave cycle, which provides a robust framework for understanding market cycles and investor behavior. This phase will be critical in determining its future market behavior.
Solana’s current trading price is $141.45, reflecting a robust bullish trend supported by an upward channel and the 50-day Exponential Moving Average (EMA) positioned around $139.55. However, maintaining this positive trajectory hinges significantly on its ability to sustain above the critical support level of $138.80. A breach below this level could trigger a bearish reversal.
In terms of resistance levels, it faces critical thresholds at $144.40, $148.00, and $151.00, which are pivotal points to monitor for potential breakout opportunities. Meanwhile, the Relative Strength at 50.74 indicates neutral market sentiment. Solana’s technical analysis suggests further upward potential if it holds above $138.80.
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