Solana (SOL) tapped the lows of the market in 2022 due to its ties with the embattled founder of collapsed exchange FTX, Sam Bankman-Fried. However, 2023 has proven to be an amazing year for SOL, whose price action has been impressive over the last few months.
As a result, market players who turned their backs on the project earlier, now have their eyes on it. This is also one of the reasons that the ongoing Solana Breakpoint conference has gained a lot of traction. In turn, the SOL price has continued to keep its uptrend, gaining 19.12% in the last seven days.
Meanwhile, a pseudonymous research handle on X (formerly Twitter) called An Ape’s Prologue posted that the recent SOL pump is not just related to the conference. He explained that the approval for FTX to liquidate some of its assets also played a part.
$SOL Breakpoint Rally
The recent market rally has acted like a rising tide, lifting prices across the board for all tokens. $SOL however, had been gaining in strength weeks before the surge.
At the tail end of September, the token sparked its own rally, breaking away from the… pic.twitter.com/ET5URt7Bxi
— An Ape’s Prologue (@apes_prologue) November 2, 2023
An Ape’s Prologue argued that a sizable part of the market thought FTX was immediately going to sell off its SOL holding. But that was not the case. However, traders increased the liquidity assigned to SOL contracts, intending to short the token.
Entry May Appear at $36.93
This, in turn, triggered a spike in Open Interest. So, instead of the SOL price decreasing, the Open Interest served as a strength to back up its rally. Now, the analyst mentioned that SOL has a chance to hit $46.80—a level the surge in Open Interest targeted at one point.
Meanwhile, the SOL/USD 4-hour chart showed that the previously bullish structure has been marred by a series of red candles. This decrease could be linked to profit-taking in some corners, especially as Solana seems to have provided more than enough gains.
Besides that, the recent decision by FTX to unstake some of its SOL seemed like a solid reason to put out the bullish streak. Consequently, the Relative Strength Index (RSI) reading dropped to 52.31.
SOL/USD 4-Hour Chart (Source: TradingView)
This decrease in the indicator reading is a testament to the waning strength SOL once boasted of a few days ago. So, it is likely for SOL to drop further from $39.04. Additionally, the 0.618 Fibonacci retracement level showed that a nominal pullback may hit $36.93.
At the same time, the value could be a prime entry point to consider. At the glance of a significant bullish return, the Fibonacci indicator revealed that SOL may hit $46.80.
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