Solana [SOL] has bounced back in tandem with the wider cryptocurrency market. Following Bitcoin’s surge to over $66,000, SOL, like numerous alternative cryptocurrencies, saw an upward trend, reaching weekly peaks.
At the time of writing, Solana was trading at $154, registering a 1.47% increase in a 24-hour period. Concurrently, spot trading volumes surged by approximately 45% during this timeframe, as per CoinMarketCap.
These advancements have altered the sentiment among investors and institutions regarding Solana, now leaning towards a bullish outlook.
Despite concerns regarding a probable sale of millions of dollars’ worth of Solana by defunct crypto entities FTX and Alameda Research, the positive narrative has prevailed.
FTX Unlocks Solana Holdings Worth $28 Million
Information from Solscan revealed that on October 15, an address linked to staking by FTX and Alameda released 178,631 SOL, valued at approximately $28 million at the current Solana price.
According to blockchain researcher EmberCN, it is probable that these tokens will be transferred to cryptocurrency exchanges. This staking address usually redeems roughly 170,000 SOL between the 12th and 15th of each month, subsequently sending them to platforms like Binance or Coinbase.
If the freshly unstaked tokens are liquidated, it may impose selling pressure on Solana. Yet, an analysis of the one-day chart indicates that the bullish momentum is prevailing, overshadowing bearish sentiments.
Solana Price Evaluation
Solana has demonstrated a bullish crossover following the 20-day Exponential Moving Average (EMA) surpassing the 100-day EMA.
This crossover indicates a shift in sentiment favoring buyers, likely propelling further upward movement.
An upsurge in buying pressure is also evident on the Moving Average Convergence Divergence (MACD) histogram, displaying green bars. Furthermore, the MACD line has turned bullish, rising above the signal line.
If this bullish trend persists, SOL could target the next resistance level at $172.
In case of a drop to the support level of $149, another buying opportunity might arise for SOL provided the broader market continues its uptrend and the sentiment towards SOL stays positive.
Solana’s recent gains were likely influenced by a spike in funding rates reaching a seven-day peak, which squeezed short sellers.
On October 14, short liquidations worth $9 million in Solana were recorded, marking the highest level since early August.
These liquidations spurred short sellers to transition to buyers to close their positions.
Aside from the buying pressure generated by short traders, the ascent of Solana-based meme coins has also contributed to the gains.
According to CoinGecko, the market capitalization of Solana memecoins surged by 17% in the last week, reaching $11 billion.