Solana [SOL] is on track to excel in the upcoming bullish market, potentially surpassing other alternative cryptocurrencies if Bitcoin [BTC] escalates.
Recognized for its user-friendly interface, Solana has built a strong reputation and stands out as a promising contender for growth. Nevertheless, despite its potential, SOL has encountered resistance from its bullish market support level.
Technical expert Benjamin Cowen observed on X (formerly Twitter) that Solana’s behavior resembled that of Ethereum [ETH], hinting that SOL could revert to its earlier ascending wedge pattern if the existing trend continues.
This indicates an imminent crucial phase for Solana. October is anticipated to be a positive month for both SOL and the wider crypto market, historically representing a robust period since the inception of cryptocurrencies.
Although there has been some horizontal movement, there is still a preference for taking long positions in SOL, with the potential for profits, though this remains a speculative venture.
If SOL remains below the retesting zone of its ascending triangle for an extended duration, the price might drop before any notable upsurge.
Volatility Gauge for Solana
Aside from these technical assessments, the introduction of the Solana Volmex Implied Volatility Index (SVIV) introduces another dimension of evaluation. At the time of writing, the SVIV, measuring the anticipated 14-day volatility of SOL, stood at 87.
This high volatility index suggests an expectation of substantial price fluctuations, either in an upward or downward direction.
While such volatility can entice traders seeking to leverage these movements, it also amplifies the risk of unforeseen and sharp losses.
With Bitcoin’s value climbing, Solana stands to gain from these market conditions, although caution is advised.
Analysis of On-chain Data
On-chain data, as per Artemis, added complexity to the Solana outlook. While SOL continues to lead in daily active addresses, indicating considerable activity on the network, institutional activity does not convey a bullish sentiment.
According to Lookonchain, one institution liquidated 695,000 SOL, valued at about $99.5 million, this year. This institution has been offloading an average of 19,306 SOL per week, totaling nearly $100 million in sales.
Despite these sell-offs, the institution still possesses 1.88 million SOL, valued around $255.89 million, which is staked. This selling pressure has likely contributed to Solana’s recent price struggles.
Solana Price in Relation to Pump.Fun Tokens Launch
Furthermore, the introduction of Pump.Fun tokens has had a noticeable impact on SOL’s price. A scrutiny of the price chart reveals that SOL’s upward momentum stalled around the time of these meme coin launches.
Pump.Fun has divested a substantial part of its proceeds, including 264,373 SOL at an average price of $157.5, leading to a significant dip in Solana’s price.
This development has fueled apprehension among investors, as the selling pressure from these tokens has exerted a notable influence on Solana.
Solana-Staking Initiatives
Nevertheless, there is optimism for Solana following Binance [BNB]’s recent announcement of the forthcoming launch of its Solana Staking product, BNSOL, slated for late September 2024. In addition, JitoSOL’s TVL surpassed 13M SOL for the first time.
This staking opportunity will enable users to stake SOL tokens, earn dynamic rewards, and retain control over their assets, potentially influencing positively on Solana’s future prices.
Solana could witness a resurgence, propelled by these new staking avenues and the possibilities for a broader market recovery.