- Analysts predicted a significant surge in the price of SOL.
- Meme Coin activity on the network has led to high demand for the token.
With only two days left until the end of January, prices are Solana (SUN) I started to feel energetic again. At press time, the price of SOL was $96.61. This value represents an increase of 7.38% over 7 days.
But for some analysts, like Ali Martinez, SOL may be poised to go even higher in the future.
Proofreading season is over
According to Martinez, the Solana native token was breaking out of a downward channel. He also noted that if SOL stays above $94, its value could rise to $113 in the near term.
#Solana It appears to be breaking out of a descending parallel channel. If the $SOL If it can hold above $94, it will likely rise to $113! pic.twitter.com/cNdS6GeXXK
— Ali (@ali_charts) January 28, 2024
A descending channel appears when a trend line connects lower highs and lower lows in an asset’s price.
As shown above, these trend lines are parallel to each other, with one representing resistance and the other a support level.
Typically the chart is in a downward trend. However, when cryptocurrencies emerge, their value can increase significantly. rest It’s out of pattern.
When the year started, SOL was priced around $100. However, the price spiked on January 2nd and by the end of that date the token was worth $116.
However, the increase was short-lived due to a widespread market correction, and SOL fell to $79 on January 23.
In the current market conditions, AMBCrypto has found growing demand for SOL.
If sustained, prices could end the month higher than where they started. A few weeks ago we Stablecoin trading volume In Solana, it increased.
Whenever this happens, it means that network activity is high.
This also means that market participants are actively engaging in blockchain-based token trading. For Solana, meme coin trading was the main reason for the surge in trading volume.
Does it end in “WEN”?
Use of data from DEXScreener, we observed that many Solana users were actively purchasing memes. And these meme coins do not include the following popular coins: BONK and dogwifhat (WIF).
For example, the market capitalization of GameStop (GME), a recently created meme coin, rose to $9.2 million.
Source: DEXScreener
Another meme that’s driving SOL demand is WEN. At press time, WEN’s market capitalization had increased to $142 million. However, this token was not an ordinary token that degenerates flocked to.
Instead, the token debuted as the first cryptocurrency deployed on Jupiter’s Launchpad. For context, Jupiter is the largest decentralized exchange (DEX) based on Solana.
Additionally, to “celebrate” the launch, over one million Solana wallets each received 643,652 WEN tokens. At launch, WEN had a market capitalization of just over $55 million.
Therefore, the recent surge means that more users are purchasing the token.
If this continues, SOL may have no choice but to rise above $96 before January 31st.
New players find safety in Solana
However, another analyst, Michaël van de Poppe, shared Martinez’s view. But van de Poppe seemed more optimistic than the former.
According to him, SOL can continue its upward trend. However, rather than stopping at $113, the value may rise towards $140.
#Solana I’m ready to continue the upward climb from here.
There is always a period of consolidation after the initial uptrend, and that appears to be over.
A higher term support test of $80 provided support.
It looks like we will continue towards $140. pic.twitter.com/5DRQaRhbZh
— Michael van de Poppe (@CryptoMichNL) January 28, 2024
Beyond pricing, new participants are flocking to the Solana network and signing up.
As a result, The Block’s data is showed The blockchain recorded its highest influx of new addresses since its launch.
Source: The Block
Looking at the chart above, you can see that many addresses are interacting with SOL. This metric is also a function of user adoption, confirming how Solana has been one of the networks with the highest traction recently.
Additionally, AMBCrypto confirmed the price action of SOL on the daily time frame. According to the SOL/USD 1D pair, the price appears to be heading towards $120.
At press time, SOL’s value has flipped both the 9 (blue) and 20 (yellow) EMAs. when When this happens, it means the cryptocurrency is likely to trade higher.
Are our coasts getting cleaner?
If the bulls push SOL to break the $100.15 resistance, the token could rise another 20%. But it also depends on the bull’s defensive capabilities.
If SOL falls below $89.69, the price could fall to $80.
However, the signal displayed at the time of reporting was nosedive. For example, Aroon Down (blue) showed a downward trend despite being at 57.14%. This was a sign that sellers were weakening.
At press time, Aroon Up (orange) was at 21.43%. Although below the opposite number, the indicator looked set to send SOL above $100.
Another indicator supporting a potential surge was the Relative Strength Index (RSI).
At the time of writing, the RSI reading has increased to 53.71. The trend also shows that SOL is out of negative divergence. If the bulls maintain momentum, the token value could initially reach $105.
In addition, the Directional Movement Index (DM) showed that there is still fierce competition between buyers and sellers. At press time, +DMI (green) was 22.25 and -DMI (red) was 21.30.
This closeness was evidence that the coast was not yet clear on either side.
Source: TradingView
Is your portfolio green? Check it out Solana Profit Calculator
However, the direction in which the SOL ultimately points may depend on the Average Direction Index (ADX). A rise above 25 for ADX (yellow) could support a strong upward direction.
However, if ADX continues to remain low, SOL may find it difficult to surge.