Even with a robust performance and growing adoption, Solana’s (SOL) price may struggle to exceed its all-time high this year. This forecast is influenced by several critical indicators that have been integral in charting the altcoin’s path.
At the start of 2024, SOL was valued at under $100. Within three months, the altcoin surpassed the $200 mark. However, it has since faced difficulty in maintaining this level, and investors might have to wait until 2025 to see the token exceed $260.
Investors Scale Back on Solana
A contributing factor to SOL hitting $208 was its Open Interest (OI), an indicator of speculative trading activity. At that time, OI surged to $2.65 billion. Open Interest represents the total value of all active contracts in the market.
An increase in open interest, in conjunction with rising prices, usually indicates a buildup of long positions. Typically, this suggests a likely continuation of the upward trend. However, as of now, open interest has fallen by nearly $1 billion, signifying that many traders have decreased their exposure to the cryptocurrency.
From a price analysis standpoint, the decreasing OI, alongside the recent price increase over the past week, suggests that the upward momentum may be dwindling. If this trend persists, Solana’s price could struggle to retest the $200 level by the end of 2024.
Read more: How to Acquire Solana (SOL) and Key Information
Moreover, a significant factor has been the $180 supply zone. Whenever SOL’s price approaches $180, it becomes increasingly difficult to rise beyond this level without considerable buying momentum.
For example, when the token reached $180 on April 9, it subsequently lost 23% of its value just days later. A similar incident occurred on July 30, resulting in an equivalent decline. Thus, even if SOL attempts to approach this level again, a double-digit drop might occur.
SOL Price Forecast: Sub-130 Remains a Possibility
In the short term, the Chaikin Money Flow (CMF) has dipped into negative territory. The CMF is a technical oscillator that measures the level of accumulation versus distribution.
An uptick in the CMF indicates significant accumulation, potentially leading to price gains if sustained. In contrast, a declining CMF suggests an uptick in distribution, signaling possible bearish pressure.
Read more: Top 13 Solana (SOL) Wallets to Consider in October 2024
Given the current state of the CMF, Solana’s price may potentially fall to $127.75. However, if OI experiences a significant increase before the quarter concludes, this prediction may not hold true. Instead, SOL could soar beyond $200.
Disclaimer
This price analysis article is intended for informational purposes only and should not be interpreted as financial or investment advice, in accordance with the Trust Project guidelines. BeInCrypto is dedicated to accurate and unbiased reporting, but please note that market conditions can change without notice. Always perform your own research and consult with a professional prior to making any financial decisions. Our Terms and Conditions, Privacy Policy, and Disclaimers have also been updated.
