Solana (SOL), the fifth-largest cryptocurrency by market capitalization, has experienced significant volatility in 2024. After enjoying a steady upward trend in 2023, the so-called “ETH killer” has failed to sustain its momentum this year. The altcoin’s price has declined by 40% from its all-time high (ATH) of $209 in March, with a 15.83% drop over the last 30 days.
At the time of writing, SOL was trading at $130.13, down 5.95% over the past week. This sustained decline has led to rising uncertainty among investors. However, analysts like Ali Martinez are anticipating an upcoming rebound.
Market Sentiments Point to a Potential Uptrend
Martinez, a prominent crypto analyst, believes that SOL may soon experience an uptrend based on its historical cycle. He points to the TD sequential indicator, which has highlighted a key buy signal on SOL’s daily charts. Martinez also cites the three previous cycles before Solana’s Breakpoint, arguing that each cycle from 2021 to 2023 saw a price upswing.
Historically, two weeks before the Solana Breakpoint, SOL tends to experience a price upswing. In 2021, it surged by 35%, in 2022 by another 35%, and in 2023 by 60%. With the 2024 Breakpoint match just 16 days away, Martinez’s observations suggest that SOL’s price may begin an uptrend soon.
The TD sequential indicator has also highlighted the end of a specific pattern based on market behavior. This indicator is expected to flash a buy signal, indicating a possible upward reversal after a downtrend.
Chart Analysis Supports a Potential Rebound
While an analysis based on previous cycles is compelling, what do SOL’s charts tell us?
For starters, Solana’s funding rate aggregated by exchange has remained positive for the last three days, despite the price decline. This indicates that investors are still confident in the altcoin’s direction, with long positions paying short positions to maintain their position. This can be interpreted as a bullish signal.
Additionally, Open Interest (OI) per exchange rose by 7.59% over the last week, from a low of $614 million to $661 million. This underlines a hike in buying activity, with investors opening new positions while others maintain existing ones – another positive market sentiment.
Furthermore, from September 3-6, 2024, the OI-weighted funding rate has remained positive, signaling increased demand for long positions. Such market conditions can be used to highlight investor confidence in the altcoin.
A Potential Rebound to $142?
If Martinez’s analysis proves accurate, coupled with the positive market sentiment, SOL may experience a short-term rebound to $142. This would represent a significant increase from its current price, and traders should keep a close eye on the next three market cycles to capitalize on this potential opportunity.
Key Takeaways:
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- Solana’s price has declined by 40% from its ATH in March, with a 15.83% drop over the last 30 days.
- Analysts like Ali Martinez anticipate an upcoming rebound based on historical cycles and market sentiment.
- The TD sequential indicator has highlighted a key buy signal on SOL’s daily charts.
- Chart analysis supports a potential rebound, with positive funding rates, increased OI, and a hike in buying activity.
- A short-term rebound to $142 is possible if Martinez’s analysis proves accurate.
Disclaimer
Readers are encouraged to conduct their own research and consult with a financial professional before making any investment decisions based on this content.
