- Solana’s price surged by over 20% to reach $175 before facing a correction, sparking mixed market sentiments.
- Key indicators suggest potential support at $173.5, with possibilities of a rally above $180 if bullish trends resume.
Solana’s price surge over the past week has caught the attention of the cryptocurrency market. With a remarkable increase of over 20%, SOL managed to reclaim the $175 mark on May 18. However, this achievement was short-lived as the token faced a price correction soon after. This raises the question: is SOL poised for further decline, or is another rally on the horizon?
Solana Back to $175
Last week was a standout period for Solana. According to CoinMarketCap, the price of SOL soared by more than 20% in just seven days, allowing it to hit $175. Despite this impressive climb, SOL couldn’t sustain its position and dipped slightly. As of now, SOL is trading at $174.39 with a market capitalization exceeding $78.2 billion.
The decline from $175 had a noticeable impact on Solana’s social metrics. A sharp drop in its Weighted Sentiment indicates a growing bearish sentiment among market participants. This shift in sentiment suggests that traders are cautious about SOL’s immediate future.
What to Expect in the Short Term
Investors shouldn’t lose hope just yet. Recent analyses suggest that SOL’s price might skyrocket if certain patterns hold. Crypto analyst Alex Clay highlighted a rounding bottom pattern in SOL’s monthly chart, which, if it plays out, could see the token reach new highs.
AMBCrypto’s on-chain metrics analysis provides further insight. Notably, SOL’s Funding Rate has increased sharply, indicating that derivatives investors are buying into SOL. Additionally, data from Coinglass shows an increase in SOL’s Open Interest, suggesting potential support for the coin’s ongoing rally.
However, there are concerns that can’t be ignored. The Fear and Greed Index stands at 75%, placing the market in an extreme greed phase. Historically, such conditions often lead to price corrections.
Examining SOL’s daily chart reveals mixed signals. The Relative Strength Index (RSI) appears bullish with a value of 64, indicating strong buying momentum. In contrast, the Chaikin Money Flow (CMF) suggests a different story, as it points downward. Moreover, SOL’s price hitting the upper limit of the Bollinger Bands hints at a potential price correction.
If a correction occurs, SOL’s price might drop to $173.5, a level that could act as a support. A further decline could push the price down to $165. On the flip side, if the weekly bull run continues, SOL has the potential to surge past $180.
Solana’s recent price movements have generated significant interest and speculation. While the current indicators show mixed signals, the possibility of SOL breaking new ground remains, provided the market conditions stay favorable. Investors should keep an eye on these key metrics and patterns to navigate the potential ups and downs of SOL in the coming days.
