As an analyst with over two decades of experience in the financial markets, I’ve seen my fair share of bull runs and market corrections. The current crypto market is no exception, and it seems Solana (SOL) is making a strong move that could potentially outshine Ethereum (ETH).
As Bitcoin (BTC) forges its own path with a strong upward trend, Solana (SOL) has promptly followed, showing similar momentum. With Solana already threatening Ethereum‘s position as the leading layer 1 blockchain network, it is expected that the price of SOL will likely draw value away from ETH in the future.
The digital currency market is in motion again. Bitcoin’s price is gradually climbing towards the peak of its bullish pattern, and other cryptocurrencies are showing signs of breaking out. However, there’s a chance that Bitcoin might experience another rejection before reaching the significant previous high of $70,000. The game isn’t over yet.
Solana greater potential than Ethereum?
Yet, when the sun favors the crypto market, it’s the strongest players in the field who stand to reap significant rewards. Solana is among these robust contenders. Currently, the Firedancer validator client is operational on the test network, while Frankendancer, its precursor, is already functional on the main network.
There continues to be a lot of negative feedback regarding Solana, with the primary concern being its increasing centralization as it strives for speed. This issue was highlighted recently by Edward Snowden during his speech at the Token2049 event held in Singapore.
Despite Solana’s rapid technology remaining potentially capable of continuing to shift value away from Ethereum’s considerably slower network, which enhances its speed through layer 2 blockchains, it may persist in doing so.
$SOL price breaks out
For Solana ($SOL), the immediate time period indicates a recent breakout from the triangle it has been enclosed in since late July this year. This breakout seems to align with a potential completion of a W pattern, which, if confirmed, could lead to a predicted price of around $170 based on the W pattern’s measured move. However, the triangle breakout suggests a much higher target.
$SOL price action follows $BTC
Looking ahead to a weekly perspective, it appears that the Solana (SOL) price has closely mirrored the extended period of sideways movement observed in Bitcoin (BTC). Approaching nine months on, the SOL price is now constructing a full candle body atop the 0.382 Fibonacci level. Additionally, the price has surpassed its downward trend line.
In simpler terms, the 0.618 Fibonacci level serves as a significant horizontal barrier for potential price increase, and it’s worth noting that this level could indicate the target price for a potential ‘W’ pattern breakout, which was previously discussed in the 4-hour timeframe analysis.
Pitfalls remain for $BTC and $SOL
Currently, a cautionary signal is coming from the Stochastic RSI, similar to what we see with Bitcoin’s price. This happens when the swift blue indicator line moves beneath the slower red indicator line, suggesting a possible increase in negative price movement.
As a researcher, I’ve noticed an interesting pattern in the Relative Strength Index (RSI) on my chart. Specifically, the RSI line has rebounded from its downward trend, and it’s consistently staying above the 50.00 mark. This suggests that the bull market is still going strong, as a dip below this midpoint might indicate the emergence of a bear market.
If the price of Solana continues to remain strong throughout this week, and Bitcoin maintains its recent upward trend, we may have just begun an exciting phase that could signal the commencement of a thrilling new chapter in the bull market.
Despite the potential, there are numerous hurdles that need to be overcome for this scenario to become more probable. If Bitcoin fails to exceed its previous peak of $70,000, it might lead to significant drops, a result of a failed rally. Solana could experience even greater setbacks. The upcoming period is critical.
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2024-10-14 15:09