- On a Year-To-Date (YTD) basis, SOL is up 448%.
- The huge price increase over the past 24 hours does not mean that the bulls are in danger.
When the year started, almost everyone who was publicly considering investing was thinking Solana [SOL] was labeled as delusional by many market participants.
At that time, no one could find fault with the attitude of the prophets of doom. One of the reasons was that the token was tipped as strong competition Ethereum [ETH]plummeted after the FTX exchange collapsed.
As a result, many believed that a recovery of the SOL to 2021 levels, when it touched $250, would be impossible. Fast forward to the latter parts of 2023: Solana has outperformed all coins in the top 10, including the King Bitcoin [BTC].
SOL leaves the market behind
But after the price hit $40, there were predictions that it was time to cool the price action. Unfortunately for the bears, that was not to be the case. To cut the story short, SOL jumped to $54 as the November 10 trading day came to a close.
According to Santiment, SOL’s price increase has resulted in a market admission that the token does not need to be highly correlated with Bitcoin or Ethereum. On the contrary, it had the ability to forge its own path.
As a result, conversations around Solana continue to reach new peaks, as evidenced by its social dominance. As with social dominance, the financing rate also increased. This increase in the financing rate indicates a sharp increase in interest rates optimistic sentiment of traders.
#Solana has now surpassed $54 for the first time since May 2022. Discussion percentages remain unchanged $SOL have risen again, indicating that the mainstream crowd is recognizing the asset’s decoupling from other assets. Financing rates are high, but are not yet in a ‘danger zone’. https://t.co/Tl9jlAsOx5 pic.twitter.com/sG97sCU9Br
— Santiment (@santimentfeed) November 10, 2023
Typically, a combination of a rise in social dominance and funding rates means that a cryptocurrency’s price may have reached a local peak. Usually, this also means it’s time to cool off when opening buy orders.
Solana, however, seemed to be dodge this rule. To support this point, on-chain data from Santiment showed that SOL was still in an opportunity zone.
To confirm whether it could still be the right time to buy SOL, AMBCrypto decided to look at the trading volume. According to data from Token Terminal, Solana’s trading volume was approximately $1.48 billion at the time of writing.
Source: Token terminal
Overcome fear and increase confidence
Like the price action, the value of trading volume represents an increase of 18.29% in the last 24 hours. Usually, rising volume combined with rising prices indicates increasing upside momentum.
So it is possible for Solana to do that crotch $55 and inches towards $60 in the coming days. That is, if the volume remains the same and there is enough buying pressure to keep the price moving upward.
AMBCrypto’s analysis of SOL’s price over a 4-hour time frame indicated that the alt could be in price discovery mode. Price discovery, largely driven by supply and demand, shows how the value of a cryptocurrency is determined by buyers and sellers.
At the time of writing, SOL’s price was on the demand side. Moreover, the Fibonacci retracement level of 0.382 was around $43.44. This means that at this price the market overcame fear and bounced on an uptrend.
Subsequently, there was also strong support at $44.81, supported by the Fib level of 0.236. Should SOL pull back, there is a good chance that a good buying position will be found at the stated price or above.
Furthermore, the Relative Strength Index (RSI) indicated that SOL was overbought.
Source: TradingView
Read Solanas [SOL] Price prediction 2023-2024
Meanwhile, the overbought condition (which usually leads to a reversal) is likely to hold SOL’s upward movement in the short term.
While the SOL has the potential to fall to $50, it may only take a little accumulation to send it back towards $60.