Will Solana Hit the $160 Mark After Recent Price Volatility?

With a 5.71% surge in the last 24 hours, Solana witnesses a boost in bullish momentum and trades at $138.53. As the 5th biggest cryptocurrency is on the verge of a bullish run, the Solana team announced a new product line in a recent crypto event, Token 2049. 

Further, as the crypto market bounces back to a $2.1 trillion capitalization, the broader market is in the altcoin market. Amid the run, Bitcoin and the top 10 altcoins are on a bullish spree, recording a surge of 1% to 5%. This sudden surge in the bullish momentum comes with the announcement of the US Fed cut rate by 50 Bps.

Bullish Momentum Driving Optimism

The chair of the Federal Reserve, Jerome Powell, decided to cut the U.S. interest rates by 50 basis points. This rate cut was highly anticipated as the broader market witnessed the inflation curving under the estimated 2% level, and the upcoming presidential election has a history of quantitative easing. With the dynamic shift in the U.S. market, the crypto market segment is bouncing back. The crypto market is ready to bounce back with the lowered interest rates.

Along with the rate cuts, another bullish catalyst fuels the Solana recovery. At the famous Token 2049, the Solana team announced a second mobile device, Seeker. The new device comes as a “rewards magnet,” a tag given by Solana Labs’ General Manager, Emmett Hollyer.  

Technical Overview and Price Action

In the daily chart, the SOL price action reveals a long-coming descending triangle pattern with crucial support near the $120 mark. The Solana recovery run requires multiple supports from this level. As numerous bull cycles start within the triangle pattern, the recent one takes support. 

Source: TradingView 

The recent bull cycle finds broader market support. With a massive surge of 2.12% yesterday, continued by 3.01% in intraday recovery, the Solana price forms two consecutive bullish candles. This completes a minor U-shaped reversal to challenge the  200-day EMA, aligning with a positive Solana crypto price prediction.

Further, the recovery run delays the looming death cross in the daily chart between the 50 and 200-day EMA. As the bull cycle within the triangle pattern gains momentum, a potential breakout of the 200-day EMA will signal an entry opportunity for price action traders. 

Based on the Fibonacci levels, the upside target for the Solana stands at 23.60% and 50% Fibonacci level at $144 and $164. Supporting the recovery, the MACD indicator maintains a bullish alignment despite the recent increase in volatility.

Bearish Factors Creating Resistance

With the Bitcoin price fluctuating near the $62K mark, Solana trades below the 200-day EMA. Further, the declining trend in the 50-day EMA warns of a looming death cross event. 

Over the Solana network, a declining trend in non-vote transactions warns of a slowdown. 

Source: The Block

The daily non-vote transactions on the Solana network have declined from 46.11 million daily transactions on 16th July to just 35.99 million on 17th September. Significantly, a downfall has witnessed in non-vote transactions on a monthly basis compared to 1.37 billion transactions in July to 1.11 billion in August and 610 million in September, at press time.

Liquid Staking to Boost Next Solana Bull Run

In a recent report by Bybit, the future of Solana will depend on the feature called liquid staking. As the liquid staking landscape provides a massive potential for growth, the report suggests an increase of up to $18 billion. 

Liquid staking provides flexibility, liquidity, and higher yields for participants. Currently, the Solana 68% staking ratio comes from the $57 billion worth of staked SOL tokens, surpassing Ethereum’s 28%. However, from the $57 billion worth of staked SOL tokens, only 6.5% worth $3.6 billion of Solana is in liquid staking. 

Conclusion

With the bullish trend gaining momentum, Solana shows massive upside potential with breakout chances. Further, the network growth, fundamental growth, and new products by Solana fuel the hopes for a bull run. 

Hence, with the Bitcoin price climbing above $62K and the altcoin segment finding a boost in trading volume, Solana is ready to surpass the 200-day EMA. With a potential triangle breakout, the uptrend in SOL price could aim for the $200 mark.