The Solana price dropped more than 6% over the past 24 hours to trade at $94.50 as of 23:30 p.m. EST.
SOL Predicted To Outperform ETH
Despite that snap downturn that came during a bearish trading day, the co-founders of the crypto analytics firm Glassnode, Jan Happel and Yan Allemann, predicted that SOL could outperform ETH by up to 5X in a coming bull run. In an X post, the co-founders said the SOL/ETH chart suggests the SOL/ETH ratio could surge soon.
They both agreed it looks BULLISH.
But – just how much could the ratio rally?
This chart suggests, that the #SOLETH ratio could rise to ~0.76 from current level of ~0.14.
— 𝗡𝗲𝗴𝗲𝗻𝘁𝗿𝗼𝗽𝗶𝗰 (@Negentropic_) January 17, 2024
In the post, the co-founders analyzed the Relative Strength Index (RSI) indicator. This is a widely used momentum indicator that attempts to gauge whether an asset may be overbought or oversold. Currently, the RSI indicates that SOL has strong momentum, according to the Glassnode founders.
Happel and Allemann also focused on the Moving Average Convergence Divergence (MACD) indicators, which is a momentum metric that traders use to watch for possible trend reversals. The Glassnode co-founders said that this indicator is also flagging bullish for SOL.
The Solana Price Fails To Break Negative Trend
4-hour chart for SOL/USDT (Source: TradingView)
The Solana price was able to break above a medium-term negative trend line over the past 48 hours, but was quickly brought back down by sellers. As a result, SOL finds itself below the trendline once again, and is at risk of testing the $90 support level in the next couple of days.
Should the Solana price fall below this significant price point, sellers may continue to exert pressure on the altcoin. This could lead to the crypto’s value plummeting to the next key support level at $82.35 in the short term. SOL maintaining a position above the $90 mark for the next 48 hours may prevent this bearish thesis from playing out.
In this alternative scenario, SOL could attempt to break above the negative trend line again. A 4-hour candle close above this level, at around $96 may be followed by a wave of buy volume. This could potentially boost the Solana price above $100. If SOL is able to surpass its previous top at $103.60, it may then have the momentum needed to climb to $100 in the following few days.
Solana Price May Drop Some More In The Short Term
The MACD indicator on the 4-hour chart suggests SOL’s negative trend may continue for the next 24 hours. The MACD line breaking away below the MACD Signal line indicates that sellers are still putting pressure on the Solana price.
However, the RSI indicator shows that SOL is hovering near oversold territory. Although there is still room for SOL’s price to drop before it enters oversold territory, the upside potential for the altcoin is far greater than its downside potential. As a result, buyers may identify SOL’s current levels as a buy opportunity, which could boost the altcoin’s value. The positive slope of the RSI line could be a sign that buyers are starting to reclaim their strength against sellers.
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