Solana Price Direction Remains Hazy Despite 10% Weekly Rally

Solana Price Direction Remains Hazy Despite 10% Weekly Rally

Time Stamp: October 18, 2023 1:38 AM
Source Node: 2333863

The recent price surge of Solana (SOL) encountered a significant roadblock at the $25 mark, which prompted a reversal following a retest in early October. Despite this setback, the market sentiment remained relatively positive, with demand showing resilience at press time. 

SOL traders on higher time scales may find themselves in a state of uncertainty regarding price direction. As of the present moment, SOL has been on a modest 10% upward trajectory, surging from $21.5 to $24.70 over the past few weeks.

This development has left traders and investors pondering the possible outcomes for SOL’s trajectory, leading to discussions about potential bullish or bearish trends, or even a breakout.

Analysts have pointed to encouraging signs within SOL’s price chart, notably the Relative Strength Index (RSI) and the Chaikin Money Flow (CMF), both of which have been exhibiting positive trends. These indicators have shown steady upticks, indicating a commendable recovery in buying pressure and an increase in capital inflows over the past few days. 

Solana’s Positive Indicators Amidst Uncertainty

Market observers have highlighted the significance of a convincing flip of the $25 hurdle into a support level, suggesting potential bullish momentum that could drive the price towards the $27 mark in the near future. However, cautionary notes have been sounded regarding the possibility of a price reversal, given the RSI’s overbought condition and the persistence of the resistance at $25.

Solana seven-day price action. Source: Coingecko

Currently, SOL is trading at $24.16 according to CoinGecko, with a 24-hour movement of 0.0%. The seven-day rally, however, stands at an encouraging 9.9%, indicating a degree of price resilience even in the face of these challenges.

Adding to the complexity of SOL’s price dynamics, the cryptocurrency has experienced negative funding rates, despite the recent price rally. This discord between the price surge and the negative sentiment in the market has fueled debates among investors about the sustainability of the current upward momentum.

SOL market cap currently at $10.07 billion on the daily chart: TradingView.com

Discontinuation Of Services By Lido Finance

In a significant development, Lido Finance, a prominent liquid-staking provider, announced its decision to phase out services on the Solana network in the coming months.

As the third-largest protocol on the Solana blockchain and with a presence on multiple chains, including Ethereum, this move has sent shockwaves through the cryptocurrency community.

The announcement caused a notable impact on Solana’s Total Value Locked (TVL), which witnessed a sharp decline of $100 million within a single day following the news.

SOL total value locked. Source: DefiLlama

As SOL grapples with these mixed signals and developments, the immediate outlook for the cryptocurrency remains uncertain. Traders and investors are closely monitoring the upcoming price movements, awaiting further market cues and developments that could potentially sway the balance towards bullish recovery or a prolonged bearish phase. 

While the indicators suggest a potential breakout, the cautionary notes regarding resistance levels and market sentiment continue to linger, creating an air of anticipation and apprehension in the cryptocurrency community.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from Meetinghouse

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