Analysis

Solana bulls euphoric after price touches 2023 highs

Solana presented a good risk-reward buying opportunity on the retest of a former resistance zone, and the bulls remain in control of the market.

Published

1 year ago

on

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

  • Solana pushed past the previous high of $27.12 made in February to reach $32. 
  • The adventure above $30 didn’t last more than a few minutes but illuminated bullish intent.

It was bull season once more for Solana [SOL] when the token climbed above $18 in late June. Since then, it has broken two strong supply zones on the 1-day price chart. From a technical perspective, it presented another buying opportunity for positional traders.

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On-chain metrics also saw a good performance. There was a slight uptrend in the number of active users, and a large spike in smart contract deployment on the platform was also spotted.

The daily chart showed a rally past $30 is likely in the upcoming weeks

Source: SOL/USDT on TradingView

While SOL appeared to lose some bullish steam in the lower timeframes, its 1-day chart showed huge bullish potential. This is on top of the strong performance of the bulls in July. As things stand, SOL has rallied 45% this month and more was likely to follow.

The 1-day bearish order block at $24 was highlighted in cyan. It was formed in mid-April, but the recent price surge defeated this supply zone. At the time of writing, it was retested as support.

The most recent rally has its base in the bullish breaker block at $18.3. The Fibonacci retracement levels showed that the $25.23, $23.6, and $21.28 levels will serve as support in case SOL retraced further south. The RSI showed robust bullish momentum and the OBV uptrend signaled significant demand that fueled the rally.

The Open Interest chart should enthuse longer-term buyers

Source: Coinglass

Realistic or not, here’s SOL’s market cap in BTC’s terms

Solana was firmly bullish in July. The sentiment of speculators in the market has also grown with bullish conviction since late June. The chart from Coinglass showed a steady rise in OI, which was a good indicator of sentiment.

Therefore, SOL presented a good buying opportunity targeting $32 and $35.4 as take-profit levels based on the Fib levels. This idea will be invalidated upon a drop below the 78.6% retracement level at $21.28.

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