- Solana (SOL) was the best-performing cryptocurrency in the top 10 list over the past 24 hours.
- SOL’s performance is even more impressive given the fact that FTX was granted approval to liquidate its cryptocurrency holdings.
- If SOL is able to break above the negative trend line that had formed on its daily chart then it may rise to $35.
Solana (SOL) was the best 24-hour performer in the top 10 list of the most valuable cryptocurrencies. According to CoinMarketCap, the Ethereum-killer printed a daily gain of 3.94% to reach a price of $18.82 at press time. This trumps the next biggest gainer, Ethereum (ETH), which only recorded a 1.71% price increase during this same period.
The altcoin’s impressive price performance is further highlighted by the fact that the collapsed FTX was recently granted approval to liquidate its cryptocurrency holdings, which included a large amount of SOL. Despite the potential selloff, investors and traders identified SOL’s price as a buy opportunity that was too good to pass up.
Daily chart for SOL/USDT (Source: TradingView)
From a technical standpoint, SOL’s price encountered a significant test on Tuesday when it tried to breach the critical support level at $17. However, bullish investors successfully defended this level, leading to a surge in buying activity.
Consequently, the altcoin’s price rebounded from the support level, initiating a positive trend that extended over the following few days. Moreover, at press time, technical indicators were hinting at the possibility of this upward momentum continuing over the next 24-48 hours.
During the past 48 hours, the daily Relative Strength Index (RSI) crossed above its Simple Moving Average (SMA), resulting in a noticeable bullish technical signal. This signal suggests that the bullish sentiment is prevailing.
Additionally, another significant bullish technical flag was on the verge of triggering on SOL’s daily chart. At press time, the Moving Average Convergence Divergence (MACD) line was attempting to cross above the MACD Signal line. Should these two lines cross it would indicate a bullish reversal in SOL’s trend.
Despite these encouraging signs, there remains a downward trend line that SOL’s price needs to surpass before traders and investors can confidently consider entering long positions for the altcoin. This descending trend line has developed on the daily chart of SOL over the past few weeks, during which time the price consistently established lower highs.
Notably, this trend line aligns with the 100-day Exponential Moving Average (EMA) line, which is currently positioned around $21.13. Consequently, SOL’s price must close a daily candle above this particular technical indicator to break free from the medium-term downtrend.
Achieving this would potentially set the stage for an attempt to transform the $25 resistance level into support in the upcoming days. Subsequently, the cryptocurrency’s price will then have a clear path to climb to the next milestone at $35.
However, in an alternate scenario where SOL’s price encounters resistance from the 100-day EMA line in the coming week and fails to secure a daily candle close above it, there is a risk of revisiting the previously mentioned $17 support level. If selling pressure persists, SOL’s price may dip below this critical level and potentially reach as low as $12.75 as well.
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