- Solana decoupled from the broader market, rising as high as $24.
- The AO indicator echoed a bullish bias for SOL which could push the price 25% higher in the coming weeks.
- With a strong directional index and increased demand, SOL could exchange hands at $30.
For the past few weeks, the cryptocurrency market has continued to continue its dynamic ebb and flow trend. Like Bitcoin (BTC), most altcoins have also traded tightly as the market continues to exhibit low volatility.
However, unlike the other altcoins, Solana (SOL) seems to have decoupled from the trend. According to CoinMarketCap, SOL has gained 7.22% in the last seven days, rising to $24.94 in the process. The increase suggests that the cryptocurrency might be gearing up for a significant and sustained bullish run.
Encouraging Indicators
From the SOL/USD 4-hour chart, the Awesome Oscillator (AO) had moved into the positive region at 0.33. A positive reading of the AO suggests that the 5-period Moving Average (MA) is greater than the 34-period MA.
The AO being above zero implies that bullish forces were driving SOL’s momentum. Furthermore, indications from the Exponential Moving Average (EMA) showed that the 50 EMA (blue) was above the 200 EMA (yellow). Typically, this is a sign for SOL to extend its bullish run in the long term.
However, there was no golden cross on the 4-hour chart which would have confirmed the run. A golden cross occurs when the short-term EMA crosses over the long-term EMA. If subsequent patterns echo this crossover, then SOL may rise as high as 25% above $24.78.
SOL/USD 4-Hour Chart (Source: TradingView)
But besides the technical outlook, SOL may also need external factors for the rally to become a reality. An increase in traction on the network, and a hike in market participation could play a vital role in the price action.
SOL Could Ready for Another Run
In terms of the Directional Movement Index (DMI), the 4-hour chart showed that SOL was directionally strong. At press time, the +DMI (green) was above the -DMI (red) at 26.77 to 12.61 respectively.
The +DMI dominance is a sign that buyers still had control of the market. Meanwhile, the Average Directional Index (ADX) was 36.57. As a measure of directional strength, the ADX (yellow) ranges from a low of zero to a high of 45. Values of the ADX over 25 imply that the price of an asset is directionally strong. On the other hand, values below 25 suggest a weak directional price.
SOL/USD 4-Hour Chart (Source: TradingView)
Therefore, the ADX value suggests that SOL had a stronger price swing in the upward direction. With increasing volatility shown by the Bollinger Bands (BB) and increased demand, SOL could soon trade around the $30 region.
Disclaimer: The views, opinions, and information shared in this price prediction are published in good faith. Readers must do their research and due diligence. Any action taken by the reader is strictly at their own risk. Coin Edition and its affiliates will not be liable for direct or indirect damage or loss.
The post Solana (SOL) May Be Showing Promising Signs of a Long Rally appeared first on Coin Edition.