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Saturday, September 9, 2023

Solana- A Competitive Buy With Price At 10-Months Low?

The price of Solana dropped on the 3rd of June, which brought its new loss on paper down to 85% seven months after it ended up topping above $260. The price of SOL went down by more than 6.5% intraday to a sum of $35.68- after it failed to rebound with conviction from its lows of 10-months.

Now, after it had been sitting on quite a historically significant support level, the pair of SOL/USD could definitely see an upside retracement in June, where they would be eyeing the $40-$45 area next, at a sum of around 25% from the price on today.

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Solana Could See Lows Over The Next Months 

However, it has been understood that a rebound scenario seems pretty far from guaranteed, and Solana currently faces headwinds after it started trading in lockstep with Bitcoin- which is the top cryptocurrency that usually influences most of the trends across the top altcoins. Interestingly, the weekly correlation coefficient between SOL and BTC was 0.92 as of the 4th of June. Incidentally, SOL is also likely to see even bigger losses than BTC if Bitcoin did fall deeper below its current psychological support level of $30,000.

At the same time, the Federal Reserve also looks pretty determined to raise the interest rates above the benchmark while reducing its balance sheet. As a result of such a hawkish policy, most of the riskier assets like Bitcoin have the opportunity to go far lower, which could also hurt the bullish prospects of Solana. Going under the current support level of SOL- at around $35- does raise the chance for a decline towards the range of $18 to $25- which did act as quite a strong support area in March-July 2021.

The bearish outlook of Solana also comes at the same time the blockchain faces repeated outages- leaving the network quite unusable for its key DApps. 

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