In the world of cryptocurrency, Solana (SOL) is presently exhibiting conflicting biases on its 1-day and 4-hour timeframes. Shorter timeframes lean towards the bullish side, potentially driving SOL’s rally towards the ZAR 355-374 price range in the South African market. However, it’s crucial to note that the current data does not provide a significant basis for forecasting further gains.
Solana’s Performance: A Closer Look
Solana (SOL) embarked on a short-term uptrend as bullish investors successfully breached the ZAR 299 resistance level. However, the higher timeframes did not display strong bullish signals, indicating a potential slowdown of SOL’s bullish momentum around the ZAR 374 resistance level.
Tether’s (USDT) dominance has experienced a significant decline over the past ten days, corresponding with a rally in the broader cryptocurrency market. Bitcoin (BTC), in particular, has shown considerable gains, as evidenced by the increasing trend in Bitcoin dominance.
Since June 15, Solana has consistently formed higher lows on the 4-hour chart, indicating an upward trend. Furthermore, on June 21, it exceeded a previous lower high, effectively breaking the bearish market structure. This breakthrough, coupled with the subsequent formation of a higher high and higher low, confirmed the initiation of an uptrend on the 4-hour chart.
While the daily chart of Solana pointed towards a strong bearish sentiment, there are significant levels for the bulls to overcome on the 1-day chart, namely ZAR 349 and ZAR 417. Conversely, the H4 chart revealed a noteworthy resistance zone between ZAR 349 and ZAR 361. This area, highlighted in red, also exposed a bearish order block.
Assessing the Market Trends
Considering the market structure and momentum observed in the past week, it is plausible that a move towards the aforementioned resistance zone could occur. This assumption is underpinned by the rising On-Balance Volume (OBV), which has surpassed a local resistance level. As a result, the increased buying pressure may drive prices upwards. However, it remains uncertain whether the Solana bulls will encounter a reversal around the ZAR 374 region or not.
On June 22, as the price of Solana dropped from ZAR 325 to ZAR 314, the Open Interest decreased by approximately ZAR 354 million. This decline indicated a discouraged sentiment among the bulls and an overall bearish outlook.
Following the decline, both the Open Interest (OI) and prices have shown signs of recovery, restoring a bullish sentiment in the short term. However, it is crucial to note that the upward movement might not occur over the weekend. It could potentially extend until the trading session on Monday before resuming.
During the dip, the funding rate had been negative, indicating a bearish sentiment. However, it has since climbed back into positive territory, suggesting a return to a bullish sentiment.
The potential rise of Solana (Solana (SOL) could have implications for the South African cryptocurrency market, and its performance is something investors in the country will watch with keen interest.
*All currencies in the article have been converted to the South African Rand