Solana’s [SOL] current market situation is showing signs of a bullish formation with a classic cup and handle pattern emerging on its weekly chart, indicating a potential breakout. As of the latest update, SOL was trading at $238.32, marking a 1.08% increase over the last 24 hours.
The price is currently undergoing testing within a crucial supply zone, and a successful breakthrough at this point could trigger a significant uptrend in the market.
Traders and investors are eagerly awaiting to witness whether SOL can sustain its current momentum and surpass this critical resistance level.
Is SOL Ready for a Breakout?
The weekly chart of Solana clearly illustrates the formation of a traditional cup and handle pattern, signaling a possible upward movement in the market. The price is approaching a robust supply zone, a pivotal point of resistance that may shape its future trajectory.
A successful breach above this zone is anticipated to attract more buyers, propelling SOL’s price higher. Conversely, a rejection could lead to a temporary pullback.
Therefore, traders are closely monitoring SOL’s price action in this area to ascertain the forthcoming market direction.
Evaluating Technical Indicators
Technical indicators offer further reinforcement to the optimistic outlook. The Relative Strength Index (RSI) currently stands at 66.11, indicating considerable buying pressure with some room for expansion before reaching overbought levels.
Additionally, the Moving Average Convergence Divergence (MACD) is positioned at 9.22, corroborating SOL’s bullish trajectory.
These positive signals suggest that a successful breakout from the supply zone would bolster these technical indicators, attracting more traders towards long positions.
Understanding the Rise in Social Dominance
SOL’s Social Dominance has surged from 4.73% to 5.36% within a single day, reflecting an increased level of engagement and interest across various social media platforms.
Such heightened attention often corresponds to heightened market activity and price movements.
Thus, the elevated Social Dominance figure indicates a growing number of traders entering the market, potentially fueling SOL’s bullish momentum further.
Impact of Liquidations on SOL’s Momentum
Liquidity data underscores a strong bullish sentiment among traders, with SOL witnessing $44.39k in short liquidations and $1.49M in long liquidations.
The substantial volume of long liquidations implies a widespread belief in SOL’s upward potential.
Consequently, these liquidations strengthen the likelihood of SOL breaking through the supply zone and sustaining its bullish trajectory.
Insights from Open Interest on SOL’s Future
Open Interest has surged by 4.04%, reaching $6.02B, signaling a notable inflow of capital into Solana futures contracts.
Increased Open Interest reflects a higher level of trader commitment and substantial investments, thereby fostering price stability and reinforcing the bullish market trend. This surge enhances the prospects of a successful breakout above the supply zone.
Solana is on the cusp of a critical breakout phase as a bullish cup and handle pattern unfolds on its weekly chart.
Therefore, SOL is expected to surpass the supply zone, sustaining its upward trajectory and potentially paving the way for an enduring price rally.