Disclaimer: The findings of the next evaluation are the only real opinions of the author and shouldn’t be taken as funding recommendation
Bitcoin’s rally to a brand new ATH spurred the altcoin market to larger ranges previous to the weekend. The most recent addition to the top-10 squad – Solana – led the cost amongst altcoins after registering a 17% hike during the last 24 hours. Backed by sturdy 24-hour buying and selling volumes, SOL dethroned XRP to turn out to be the sixth-largest crypto with a market cap of $53.41 billion.
On the chart, a bull pennant breakout shaped the bedrock for SOL’s large leap. With such bullish market circumstances, SOL might stretch its positive aspects to the 78.6% Fibonacci Retracement degree earlier than a correction units in.
SOL 4-hour Chart
Supply: SOL/USD, TradingView
Based mostly on the flagpole’s size, SOL focused a 22% run-up from the breakout level of its bullish pennant. The formation of ‘three white troopers’ – A bullish candlestick reversal sample – indicated a robust change in market sentiment as SOL rebounded from the 38.2% Fibonacci degree.
As per SOL’s projected goal, there appeared to be some extra room to develop earlier than a correctional wave hits the market. The $190-mark or the 78.% Fibonacci degree can be enticing take-profits and SOL might lengthen its leg to those factors over the approaching classes.
As soon as a retracement kicks in, SOL can look to stabilize on the 61.8% Fibonacci degree or on the $181-support, earlier than the following upcycle.
Conversely, an prolonged hike can’t be discounted, contemplating the extraordinarily bullish market circumstances. A detailed above the 78.6% Fibonacci degree would see SOL goal its earlier ATH of $216. This is able to translate to a different 15% hike from SOL’s press time degree.
Reasoning
Apparently, the Squeeze Momentum Indicator famous solely 4 inexperienced bars, on the time of writing. In a bull run, the SMI often registers between 12-15 rising inexperienced candles earlier than momentum begins to decelerate. If so, SOL would see additional upside over the near-term.
In the meantime, the MACD’s first bullish crossover in 4 days may be anticipated to herald some extra upwards strain available in the market. Having mentioned that, RSI’s overbought nature is perhaps a trigger for concern.
Conclusion
Overbought readings on the RSI may be anticipated to weigh on SOL’s trajectory and the alt might see positive aspects as much as the 78.6% Fibonacci degree, earlier than bears take management. Nevertheless, if SOL is ready to put one leg above $195, a retest of $216 would turn out to be a chance.
