Solana Price Forms A Mega Bullish Pattern, $300 Next?

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As a seasoned researcher with years of experience in the cryptocurrency market, I find myself intrigued by the current state of Solana (SOL). The recent 27% drop from its year-to-date high has left some investors shaken, but a closer look at the weekly chart suggests a potential mega comeback.

Currently, Solana’s price stands at $191, marking a 27% drop from its year-to-date peak of $264. This decline has occurred alongside the broader crypto market crash that has significantly impacted Bitcoin and many other altcoins as well. However, the weekly chart indicates that Solana’s price could potentially surge in the coming days, hinting at a possible strong recovery.

Solana Price Analysis: Break And Retest Pattern Forms

Over the course of this year, I’ve observed an intriguing development in the SOL price. From March to November, a symmetrical triangle chart pattern has emerged, suggesting a potential shift in its direction. This pattern follows a significant upward trend where the coin skyrocketed from under $20 to surpass $100, hinting at the possibility that this triangle is part of a larger bullish pennant formation – a common continuation signal favored by analysts.

In simpler terms, the pennant formation in Solana’s price chart may have contributed to its significant surge to approximately $264, close to its record high. When financial assets, including cryptocurrencies and stocks, reach a significant resistance point like an all-time high, they tend to experience a steep decline afterward.

After hitting the upper boundary of its triangular pattern (referred to as a pennant), the recent drop in Solana’s price momentarily paused, which is commonly referred to as a “break-and-retest.” This phenomenon typically indicates that the market will continue in the same direction when an asset revisits a significant resistance or support level, suggesting that Solana may resume its original trend after this brief pause.

Additionally, it appears that the recent dip in SOL (SOL Crash) might be contributing to the development of the “handle” segment in the Cup and Handle (C&H) pattern. Similar to the Bullish Flag or Pennant, a Cup and Handle is frequently interpreted as a bullish indication of continued growth.

Consequently, these trends suggest a possible resurgence, aiming initially for a high of $265, which is the peak this year. Exceeding that level is likely to trigger further growth in Solana’s price, with the significant price level to focus on next being the psychological barrier at $300.

Instead, if the price falls below $160, during the triangle formation, it would contradict the optimistic chart pattern, suggesting a continuation towards lower prices, potentially reaching $100.

SOL Price Rally Supported By Fundamentals

The basics indicate a possible recovery for Solana as its network has been performing well. Evidence suggests that Solana’s ecosystem, particularly in the Decentralized Exchange (DEX) sector, is thriving. In the past 30 days, Solana’s protocols have processed tokens valued at over $126 billion, significantly more than Ethereum‘s $94 billion. Furthermore, Solana’s DEX platform Raydium is currently handling a larger volume of transactions compared to Uniswap.

In sectors such as DePIN, Solana is performing admirably alongside frontrunners like Helium and HiveMapper. Additionally, data from CryptoSlam indicates that Solana’s NFT sales volume increased by an impressive 44% over the past day, reaching $3.3 million. This surge has propelled it to become the third-largest chain in the NFT market, trailing only Ethereum and Bitcoin. Furthermore, this growth has fueled a rise in Solana network activity, setting a new record high.

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2024-12-24 15:43