Yesterday, the cryptocurrency market witnessed a significant rally, with Solana (SOL) surpassing the important resistance level of $130 on the 4-hour chart. This breakout has piqued the interest of investors, who are now hopeful for a price increase in the coming months, as optimism surrounds the market.
Related Reading
Many market analysts predict additional gains, citing Solana’s recent performance as a strong indication of its potential. Investors are paying close attention to SOL’s ability to sustain its upward momentum, driven by increased demand and enthusiasm, fostering bullish expectations for the altcoin.
Beyond market enthusiasm, Coinglass’s on-chain metrics provide an optimistic perspective on Solana. These indicators support the bullish trend, suggesting that a rally for Solana could be in the works.
As more traders seek to take advantage of these developments, Solana’s performance may soon become a key factor influencing the overall market trend for altcoins.
Solana On-Chain Metrics Indicate Strength
Currently, Solana is testing its local supply and attempting to surpass a critical daily resistance level at $137. On-chain metrics from Coinglass reflect a strong bullish sentiment among traders and investors.
A significant metric showcasing this optimism is Solana’s Open Interest (OI)-Weighted Funding Rate, which is presently at +0.0068%.
A positive funding rate means that traders holding long positions are paying fees to those with short positions, generally indicating an expectation of price rises. This implies that bullish momentum is gathering, with traders looking forward to a short-term rally in Solana’s value.
The increasing interest from long positions further reinforces the hypothesis that Solana is preparing for a price surge. The bullish sentiment is prevalent among traders, and data indicates a solid chance that SOL could break free from its current trading range if market conditions remain favorable.
Nevertheless, for this positive outlook to materialize, Solana must surpass its current resistance level at $138 and close a daily candle above this critical threshold. Successfully breaking and holding above $138 could hint at a potential upward progression to higher price levels in the near future.
Related Reading
As the market develops, traders will closely monitor Solana’s price movements and market structure to assess whether a notable rally is on the horizon. In the interim, Solana displays positive signs, with bullish indicators suggesting an encouraging short-term outlook for the cryptocurrency.
SOL Price Action
Currently, Solana (SOL) is priced at $135, just 4.5% away from an essential technical marker: the 4-hour 200 exponential moving average (EMA), located at $141.14. This level serves as a pivotal strength indicator for SOL, and recovering it would represent a gain in bullish momentum.
Should SOL break above the $135 resistance and reclaim the 4-hour 200 EMA, it may catalyze a substantial upward movement towards the $160 supply zone. This would signify a remarkable recovery for the asset, possibly attracting further buyers and driving the price upwards.
Related Reading
Conversely, if Solana fails to overcome the $135 resistance, a pullback to lower demand levels appears probable. The $126 mark could act as the next support level for buyers to step in and stave off a price decline.
As SOL navigates these critical levels, traders are keeping a close eye on whether the bulls can sustain their dominance or if a correction is impending.
Featured image from Dall-E, chart from TradingView
