Solana, the sixth largest cryptocurrency by market capitalization, is demonstrating signs of developing into a well-known cup-and-handle formation on its charts. The pattern, which was evaluated and brought to light by crypto analyst Ali, suggests a bullish breakout that could catapult Solana’s price to a staggering $3,800.
The weekly chart displays an expanding bottom shape, forming the ‘cup’, while a gentle price decline defines the ‘handle’. This bullish structure could potentially trigger Solana to jump to the forecasted price target of $3,800, representing a gigantic 2,940% surge compared to current market rates.
However, this optimistic prediction is contrasted with Solana’s recent performance. The digital asset dropped to a year-low of $112 after five consecutive days of decline and is currently trading at approximately $125. This represents a 1.39% decrease in the past 24 hours. Furthermore, Solana remains well below its all-time high achieved in January, with the overall crypto market conditions heavily influencing its performance.
One of the key challenges Solana faces in the short-term is the formation of a ‘death cross’ on its daily chart. This bearish signal is formed when the 50-day moving average dips below the 200-day moving average, indicating potential market weakness. This pattern emerged on March 12, and if the support level falls to $125 or lower, Solana could potentially tumble to $80. However, diverse support within this current price range may provide a safety net, preventing further price decline.
Despite these bearish indicators, institutional interest in Solana continues to grow. The Chicago Mercantile Exchange (CME) is set to launch Solana futures contracts on March 17, marking one of the earliest regulated futures products for the asset in the US. This follows the introduction of Solana derivatives on Coinbase in February, further demonstrating the growing interest from major financial institutions.
As Solana continues to navigate through these market fluctuations, the resilience of the underlying technology, which serves as a key platform for meme coin developers, will undoubtedly play a crucial role in its future trajectory.
In conclusion, while Solana’s short-term outlook is riddled with obstacles, the long-term perspective, as suggested by the cup-and-handle pattern, paints a more promising picture. The growing institutional interest and potential for substantial upward price movement will continue to position Solana as a cryptocurrency to watch in the coming months.
