Solana value efficiency in current occasions has been outstanding, surpassing Ripple and Binance Coin to develop into the fourth-largest cryptocurrency by market cap. The SOL value breached the vital stage of $100 for the primary time since April 2022 over the weekend to imbue optimism amongst buyers. Nevertheless, the altcoin has corrected by 7%, suggesting that the market is overheated. On the time of writing, the ‘Ethereum killer’ was buying and selling barely decrease at $111.60.
Solana value has made a major restoration over the previous few weeks, climbing above the psychological stage of $100. The altcoin has been one of many best-performing property this yr, extending its year-to-date positive aspects to greater than 1,025%, with extra positive aspects recorded previously month alone. Nevertheless, even with such development, analysts have famous that Solana has a bleak probability of topping its ATH of $260.
The explanation behind that is the rise in provide relative to its worth. In November 2021, when the Solana value hit its all-time excessive of $260, its whole market capitalization was round $78 billion. Regardless of the worth of the crypto asset being lower than half of what it was on the high, its market cap is at present hovering close to $50 billion.
This has been led to by the rise within the Solana provide by greater than 100 million SOL over the previous two years. In line with some analysts, for the altcoin to retest $260, its whole market cap must be round $111 billion, which appears reasonably tough with institutional buyers pouring billions into the asset.
SOL’s current surge has been on the again of considerable on-chain exercise. The continuing hype for the blockchain’s speedy transactions and low cost charges has buoyed SOL’s on-chain exercise. Moreover, the crypto market has been within the inexperienced over the previous few weeks, boosted by a weaker US greenback and the potential deadline for the primary approval of a spot Bitcoin ETF on January 10, 2024.
Solana Price Outlook
Solana value has been on a powerful bullish trajectory over the previous few weeks, regardless of going through a powerful rejection on the essential resistance stage of $120. The digital asset stays above the 50-day and 200-day exponential shifting averages and the 100-day and 200-day easy shifting averages. Its Relative Power Index (RSI) stands at 74, indicating that the asset is overbought on account of its current rally.
As such, the market must settle down earlier than resuming its rally. Moreover, its bullish momentum is waning proper now, characterised by the receding inexperienced bars of the Shifting Common Convergence Divergence (MACD) indicator.
Due to this fact, Solana value might expertise a correction to $100 or decrease till the market cools down, after which it will collect the power to renew its rally. Alternatively, if the bulls proceed to cost the altcoin, Solana might flip the instant resistance at $120, including confidence to its present market place.