Over the past year, Solana (SOL) has emerged as one of the standout performers in the world of cryptocurrencies. Few digital assets can boast the same level of growth and resilience in the face of market downturns. As the current bearish trend persists, the question looms: will Solana be able to defy the odds once again?
Since late August, bearish sentiment has been dominant in the SOL market, leading to a significant price decline. The token is now hovering around a crucial level of $120, which has historically served as a sturdy support zone over the past six months.
Recent price action has shown SOL consolidating above this key level in early September, with signs of sell pressure dwindling. This suggests a possible accumulation phase underway, as buyers step in at lower prices.
Analysis of SOL demand indicates a notable increase in net long positions, surpassing 18 million NLs at the $128 mark. This shift in market sentiment towards bullishness is a positive sign for SOL’s potential recovery.
However, the surge in long positions also raises concerns about potential liquidations that could drive prices lower. A recent price drop below $128 triggered a wave of liquidations, shaking out leveraged positions and testing the support levels.
Will Solana Witness a Strong Rebound Amid Altseason Momentum?
Aside from the ongoing consolidation, SOL stands to benefit from the influx of liquidity during the altcoin season surge. With Bitcoin’s dominance on the decline in recent days, the spotlight is shifting to alternative cryptocurrencies.
As one of the most promising altcoins of the year, Solana has garnered significant attention from investors seeking lucrative opportunities in the market.
While on-chain metrics like transactions and volumes dipped towards the end of August, a recent uptick in on-chain activity hints at renewed interest. Transaction volumes have shown a notable increase, accompanied by a slight rise in trading volumes during the same period.
Despite bearish price action, these on-chain developments suggest a potential spike in accumulation, setting the stage for a possible resurgence in SOL activity.
If the anticipated altseason gains momentum, Solana’s network could see a resurgence in activity, driving up transaction volumes and demand within its DeFi ecosystem.
Should this scenario unfold, it could pave the way for a robust recovery similar to previous instances. A potential rally of 15% to 20% from the current levels could push SOL’s price above $160 in the coming days, contingent upon a strong bullish push.