Solana Down 40% But Analyst Says Now’s The Time To Buy SOL
June 19 2024 - 6:00PM
NEWSBTC
Solana, one of the top altcoins, trailing Ethereum and the BNB
Chain, has not been spared in the recent correction. After rallying
to as high as $210 in Q1 2024, the coin is now sliding, facing
strong headwinds, plunging, and following the performance posted by
Bitcoin and Ethereum. Is This The Best Time To Buy Solana? Even
amid this deep retracement, Raol Pal, a macro analyst, thinks this
is the best time for investors and traders to consider Solana. In a
post on X, Pal said traders may look at loading the coin, citing
the candlestick arrangement in the daily chart. Looking at the
SOLUSDT chart, it is clear that the coin is moving sideways and
inside a broader flag after the spike to over $200 in March.
However, what’s emerging amid the cool-off is that the zone between
$120 and $125 is a support to watch out for. Related Reading:
Altcoin Massacre? Prices Plummet 40-90%, Recovery Stalled — Analyst
At press time, SOL is changing hands at around $130, down
approximately 40% from the March 2024 highs. If bears of late May
2024 press on, it will be interesting to see how prices will react
at this level. From Pal’s position, the analyst expects prices to
bounce back from this level and resume the uptrend from last year.
The problem is that there won’t be any guarantee that prices will
shoot higher from this support zone. Technically, a close above
$190 and preferably $190, could mark the resumption of the next leg
up, quashing bears. On-Chain Activity Shrinking As Ethereum Set For
More Institutional Support Whether this will pan out in the
coming weeks or months is unclear. How SOL performs is primarily
tied to market developments and on-chain activity, among other
factors. Although Solana is fast emerging as a preferred choice for
meme coin issuers, there has been a marked drop in on-chain
activity in recent days. Notably, Ethereum layer-2 solutions like
Base, Arbitrum, and Optimism appear to be taking over. Related
Reading: Bitcoin Battles $64,515 Support Level, Can It Hold or Will
Bears Prevail? Solana offers higher scalability than Ethereum,
meaning transaction fees are low. When on-chain activity drops
relative to other cheaper platforms, it could mean the demand for
SOL is falling, which is a net negative for prices. At the same
time, the revival in the stock market, which has seen indices like
the S&P 500 rally, could draw investors’ attention to
cryptocurrencies. Additionally, with the United States Securities
and Exchange Commission (SEC) on the brink of approving a spot
Ethereum exchange-traded funds (ETF), more capital will flow to
ETH. Feature image from Shutterstock, chart from TradingView
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