- Solana needs to hold the $200 to target a surge to $220 as Trump’s inauguration draws nearer
- However, traders shouldn’t expect smooth sailing anytime soon
No doubt, investors have pounced on the oversold signal from Solana, sending its trading volume soaring by nearly 60%. This surge triggered a powerful green candlestick, with SOL jumping by an impressive 9% in just one day to reclaim $200 – A level it hadn’t touched in a week.
Now, speculations are rife, with many eyeing a potential rally to $220 in the short-term. Let’s break down the odds.
Investors need to show more confidence in Solana
Solana, at the time of writing, was trading 20% above its previous dip to $168, with a neutral RSI and the MACD just turning bullish – Showing there’s still plenty of room for momentum to build.
Looking at the broader market, high-cap alts have been receiving fresh capital inflows, but none have broken key resistance levels – Except for XRP, which surged past its November highs.
For Solana to hit $220, it needs to climb by another 10% – A target that seems achievable in the short-term. However, despite its recent recovery, SOL’s erratic price action highlighted a key issue – Investors still lack sustained confidence.
With a 30% surge needed from its latest dip to hit that target, profit-taking could become a real concern – Especially if traders decide to cash out early.
On top of that, the SOL/BTC pair only saw 166.46K in volume, a far cry from XRP/BTC’s 55 million. No doubt, investors seem to be shifting their focus to other altcoins this cycle.
Source: TradingView
But, it might not be too late…
With the crypto market gearing up for a potential bull rally ahead of Trump’s inauguration, fresh capital is expected to flow in. For Solana to attract this influx, it needs to hold around $200 – A level that could spark FOMO and draw in investors.
The Futures market is already showing signs of this shift. Volume is up by 49.61%, and Open Interest (OI) is just 4% below its all-time high of $6.68 billion – Perfectly aligning with Solana’s mid-November peak of $264. Maintaining $200 is now critical to avoid a potential long squeeze.
Source: Coinglass
Realistic or not, here’s SOL’s market cap in BTC’s terms
While a 10% surge for Solana seems within reach, it’s likely to be driven by broader market forces. With investor confidence shaky, a sustained rally isn’t guaranteed. Many traders may opt to exit early, eyeing a tempting 30% profit. So, expect some volatility as Solana hits key levels.
