- Solana (SOL) is consolidating near its 2021 ATH, with technical analysis suggesting a potential “best entry” price around $71 by January 2025.
- However, the bullish triangle pattern could also lead to a downward breakout if supply inflation outweighs demand.
Solana (SOL) has been caught in a prolonged consolidation phase, oscillating within a six-month downtrend close to its all-time high (ATH) achieved in 2021. As the cryptocurrency’s momentum wanes from its notable 2023 rally, trading experts are offering insights into the “best entry” price target for potential investors.
Technical Analysis Reveals Potential Entry Points
FieryTrading, a prominent analyst on TradingView, shared an extensive long-term technical analysis on August 31, 2024, focusing on Solana’s price movements. According to FieryTrading, Solana’s chart pattern resembles a “bullish triangle,” a technical setup dating back to 2021. This pattern has had several significant lows, beginning at $1.00 per SOL in December 2020. Subsequent lows have been recorded at $8.15 in December 2022, $13 in June 2023, and $17 in September 2023. These levels mark historical ideal entry points, suggesting that current and future price actions may offer advantageous buying opportunities.
FieryTrading projects that Solana might soon revisit the bullish triangle’s support, with an anticipated price target of approximately $71 by January 2025. However, the “best entry” could materialize sooner or later, contingent on the support’s evolving uptrend.
Potential Pitfalls and Market Cap Dynamics
Yet, the bullish triangle pattern presents a potential downside. The triangle also features a series of lower highs, indicating a downtrend from Solana’s ATH. For instance, in July 2024, SOL touched the triangle’s resistance at $191 but failed to surpass it, encountering resistance for four consecutive weeks from March to April.
Interestingly, Solana’s current local top at $210 shows a larger market capitalization compared to its ATH of $260. TradingView data highlights a market cap of $80.96 billion at $260 versus $93.13 billion at $210. This discrepancy stems from Solana’s significant supply inflation, which impacts its unitary price potential despite consistent demand.
Future Outlook and Investor Considerations
FieryTrading suggests that after hitting a new local bottom within the triangle’s support, Solana is expected to bounce back to its resistance level. Ideally, this could trigger a bull run and price discovery, potentially leading to a new ATH. However, there remains a risk of a bearish breakout if Solana approaches the triangle’s breaking point.
Traders and investors should closely monitor Solana’s ecosystem developments and demand indicators. The cryptocurrency market’s inherent volatility makes precise price predictions challenging, even for seasoned experts. Staying informed and adaptable will be crucial for navigating potential market shifts and making informed financial decisions.
