Solana (SOL) price prediction: Bullish vs. bearish scenarios for the future value of SOL

The Solana (SOL) cryptocurrency has been one of the most talked-about assets in the crypto space, known for its high-performance blockchain and a surge in market value in recent years.

As someone who has actively traded Solana since its early days, I’ve observed firsthand how quickly market sentiment can shift in the crypto space. I recall the dramatic rise of SOL in 2021, when it surged from under $1 to over $200 within a year, driven by widespread adoption of its high-performance blockchain for decentralized applications. Even this year, when SOL crossed up a 66 day long high of a key price level of apx $127, it then flw up another %67 in only 17 days. This experience has shown me that understanding key resistance and support levels, such as those outlined in this analysis, is crucial for navigating the volatility inherent in the crypto market.

Current price analysis 📊 with 2 sides of the coin

As of the latest data on the chart, Solana (SOL) is trading around the $141 mark. The chart highlights a period of consolidation, where SOL has been trading within a relatively narrow range, indicating that the market is at a critical juncture. The price has found resistance around the $175 level and support near the $125 level.

Bullish scenario: A path to a new all time high 🚀… But wait for this condition…

For the bulls to take control and push SOL’s price higher, the chart indicates a key resistance level at $175. According to the analysis, a sustained break above $175 is recommended to be confirmed by two consecutive weekly candle closes above this level. This could trigger a bullish breakout, leading to a potential surge in price.

• Key Level for Bulls: $175 🟢Significance: Closing above this level for two consecutive weeks could lead to a major bullish trend.Next Target: $294 💰If SOL reaches $294, it would represent a potential upside of more than 100% from the current price, making it an attractive target for long-term investors and traders. The $294 target is likely based on previous highs and Fibonacci extensions, suggesting that once the $175 resistance is broken, momentum could carry the price to new highs.

In a recent post on X, Solana Labs co-founder Anatoly Yakovenko pointed out that, for many users, the fees associated with using the Ethereum network are higher than the cost of operating a Solana node. This comparison underscores the growing debate over network efficiency and cost-effectiveness between leading blockchain platforms, which helps the bullish case.

But, in any case, in terms of price action for SOLUSD, to further understand the significance of the $175 resistance level, it’s important to delve into the use of anchored VWAP bands which offers a nuanced perspective by combining volume and price over a specific period, helping traders pinpoint areas where institutional players might have entered or exited positions. I show a thorough yet simple technical analysis of this in my following video

SOL Price Prediction video

Bearish Scenario: Downside risks and support levels ⚠️

On the flip side, the bearish scenario comes into play if Solana fails to maintain its current support levels. The chart identifies $125 as a crucial support level. For bears, a significant signal would be two consecutive weekly candle closes below $125, which could indicate the start of a downtrend.

• Key Level for Bears: $125 🔴Significance: Closing below this level for two consecutive weeks could trigger a bearish trend.Next Support: $65 📉In this bearish case, the chart points to $65 as the next major support level. This level is approximately 50% lower than the current price, indicating substantial downside risk if the bearish scenario materializes.

Understanding the Technical Indicators: Standard Deviation Bands 📐

The chart features several lines of standard deviation bands based on the anchored VWAP (Volume-Weighted Average Price) from the all-time low of SOL/USD. These are not traditional moving averages but rather statistical bands that show how far the price has deviated from the mean price since the all-time low.

• Why Use Anchored VWAP Bands?For Algorithms: Anchored VWAP and its deviation bands are commonly used by algorithms and quantitative traders to identify overbought or oversold conditions.For Traders: These bands help traders determine potential reversal points or areas of strong support and resistance based on historical price action.

The anchored VWAP and its standard deviation bands offer a more dynamic view of the market, adjusting with price movements to give a real-time sense of market sentiment. When SOL’s price moves near or crosses these bands, it can signal potential buying or selling opportunities.

Conclusion: A critical juncture for solana ⚡ but remember these levels for guidance

In conclusion, Solana’s price is currently in an appoximate middle of a range, with key levels at $175 and $125 serving as crucial indicators of the next major move.

For Bulls: Look for two consecutive weekly candle closes above $175 to signal a potential surge towards $294. 📈For Bears: Watch for two consecutive weekly candle closes below $125 as a potential signal for a drop to $65. 📉Investors and traders should closely monitor these levels and be prepared for increased volatility as SOL approaches these critical junctures. The use of anchored VWAP and its standard deviation bands offers additional guidance, providing a robust framework for decision-making in a highly dynamic market.

THIS IS NOT FINANCIAL ADVICE and only my expert opinion. As always, it’s important to conduct thorough research and consider all factors, including broader market conditions, before making any investment decisions. Visit us at ForexLive.com for additional views 🧐

This article was written by Itai Levitan at www.forexlive.com.

A note from economists at the investment bank. I haven’t spotted it yet but news wires carrying the highlights.

In summary:

• cuts US recession likelihood to 20% from 25%, and says it may cut further, to 15%, if the nonfarm payroll report for August is ‚reasonably good‘
• GS cite the retail sales data, best since early in 2023, and the jobless claims data showing the fewest requests for unemployment benefits in six weeks

Goldman economists say they are even more confident now a 25bp rate cut from the Federal Open Market Committee (FOMC) September meeting (17 and 18th), but a disappointment on the August jobs report could trigger a 50bp cut.

—

Retail Sales data was out on Thursday last week, a huge beat of consensus:

The August NFP is due on September 6. Ahead of then we’ll get Federal Reserve Chair Powell speaking at Jackson Hole:

Next week doesn’t start until Thursday

This article was written by Eamonn Sheridan at www.forexlive.com.

We’ve been spared from summer doldrums in financial markets this year but early next week could be something of a dud, particularly until Jackson Hole begins.

Monday kicks off with Fed’s Waller speaking at 09:15 am ET but that will be all for the day.

Tuesday features speeches from the Fed’s Bostic and Barr but is otherwise bare.

Wednesday is hardly better with only EIA weekly crude oil stocks and a 20-Year bond auction. The highlight will be the FOMC Minutes release at 14:00 pm ET; expect some dovish indicators there.

Thursday is when it picks up with jobless claims data, S&P Global PMIs (composite, services, and manufacturing), and existing home sales. The consensus for Initial Jobless Claims is 229K while existing home sales are expected to show a 0.4% decline. The Jackson Hole Symposium also begins, with extra Fed interviews usually scheduled for the early US morning.

Friday closes the week with new home sales data, expected to show a 0.6% decline to 0.63 million. The main event will be Fed Chair Powell’s speech at 10:00 am ET from Jackson Hole but with Fed pricing at 75% for 25 bps, I don’t currently see a need to make any big waves. Baker Hughes US Oil Rig Count and CFTC position data round out the day.

The Jackson Hole Symposium continues through Saturday.

For more, see the economic calendar.

This article was written by Adam Button at www.forexlive.com.

• US August prelim UMich consumer sentiment 67.8 vs 66.9 expected
• US July housing starts 1.238M vs 1.330M expected
• China issues new gold import quotas after pause — report
• Fed’s Goolsbee: There are some things that are flashing yellow
• July Canada housing starts 279.5K vs 245.0K
• Canada June manufacturing sales -2.1% vs -2.6% expected
• Baker Hughes US oil rig count -2
• Israeli intel believes Iran response will take place at later date — report
• Biden says Gaza ceasefire deal ‚is closer than three days ago‘
• Blinken to visit Middle East starting on Sunday
• Join me on Monday for a webinar on how to dodge 7 common trading traps

Markets:

• Gold up $51 to $2507
• WTI crude oil down $1.46 to $76.70
• US 10-year yields down 4.3 bps to 3.88%
• S&P 500 up 0.2%
• JPY leads, USD lags

The US dollar was broadly weak on Friday in a move that was challenging to explain. The entire USD/JPY rally from Thursday and the positive retail sales data was wiped out while other pairs continued to climb. The later was backed by a decent risk tone and modest decline in Treasury yields but it was an outsized move that was tough to pin down.

One spot I look at is ongoing de-risking. Some of those caught up in the August rout or carry trade unwind may still be looking to de-risk.

The moves were large with the euro closing above 1.10 for the first time since January and cable adding nearly a full cent in a breakout from the weekly range. The Australian dollar rode and improving risk trade to the best levels since July 22 as that rout continues to be erased across asset classes.

The big winner on the day though was gold as it hit an all-time high and broke $2500 for the first time. On the initial touch of $2500, there was some profit taking and a quick $20 drop but the bulls reorganized and bid right through the close. The catalyst was likely a report that Chinese banks have been given fresh buying quotas, along with the widespread USD weakness.

Overall though, it was a day that left us scratching our heads and early next week is likely to do the same with a very quiet economic calendar until Jackson Hole kicks off on Thursday.

Have a great weekend.

This article was written by Adam Button at www.forexlive.com.

US stock markets started lower today but found a footing early and slowly climbed the hill. Overall volatility was lower than it’s been and newsflow was light but the bulls should be encouraged by another positive close, led by smaller caps today.

On the day:

• S&P 500 +0.2%
• Nasdaq Comp +0.2%
• DJIA +0.2%
• Russell 2000 +0.35%
• Toronto TSX Comp flat

On the week:

• S&P 500 +3.9%
• Nasdaq Comp +5.3%
• DJIA +2.9%
• Russell 2000 +2.9%
• Toronto TSX Comp +3.3% (best weekly close ever)

The weekly gain in the S&P 500 and Nasdaq was the largest since last October.

This article was written by Adam Button at www.forexlive.com.

HSBC analyzes the factors behind GBP’s strong performance in 2024 and discusses the potential challenges ahead. While the currency has been resilient due to its high carry, HSBC warns that the outlook may not remain as favorable, especially with expected further rate cuts by the Bank of England (BoE).

Key Points:

• GBP’s Strength in 2024:
  • GBP has been the most resilient G10 currency this year, largely due to its high carry.
  • CFTC data shows long GBP positions are near all-time highs, highlighting the currency’s attractiveness to investors.

• BoE’s August Rate Cut:

  • HSBC notes that the BoE’s rate cut in August should not be overlooked, even though the central bank has maintained a cautious stance on easing.
  • The UK’s lackluster growth outlook suggests further easing is likely, with HSBC expecting another 25bp rate cut in November.

• Structural Challenges:

  • The UK’s current account deficit is primarily financed by „other investment“ flows, linked to the carry inflows supporting GBP this year.
  • As the carry buffer narrows, HSBC anticipates that GBP may start to weaken against the USD in the coming months.

Conclusion:

While GBP has shown remarkable resilience in 2024 due to high carry, HSBC foresees potential challenges ahead. The BoE’s continued rate cuts, coupled with the narrowing carry advantage, may lead to a decline in GBP’s strength, with targets of GBP/USD at 1.26 by the end of Q3 and 1.25 by the end of Q4.

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This article was written by Adam Button at www.forexlive.com.

The recent rally in the euro hasn’t gotten much attention because there isn’t a great fundamental backing behind it. Europe’s economy continues to struggle and the move is mostly about broader US dollar selling. That said, sometimes the technicals lead the fundamentals and the poor economy in Europe is priced in at this point while a US slowdown would be a surprise.

The pair is also beaten-down in the longer term from the 1.15-ish pre-pandemic space.

I find it hard to chase anything in Europe but there are a nice series of higher lows and it would be easy enough to squeeze the shorts, at least up to 1.12. I don’t see much of a catalyst in the week ahead though.

This article was written by Adam Button at www.forexlive.com.

Headlines:

• USD/JPY eases lower alongside bond yields on the day
• Gold takes aim at key resistance as the weekend approaches
• What are the main events for today?
• Fed’s Goolsbee: You don’t want to tighten any longer than you have to
• UK July retail sales +0.5% vs +0.5% m/m expected
• Eurozone June trade balance €22.3 billion vs €13.9 billion prior
• Never underestimate the power of US the consumer

Markets:

• JPY leads, USD and CAD lag on the day
• European equities higher; S&P 500 futures down 0.2%
• US 10-year yields down 5.9 bps to 3.867%
• Gold up 0.6% to $2,469.79
• WTI crude down 2.9% to $75.86
• Bitcoin up 2.9% to $58,287

There wasn’t any major headline catalysts on the session but the dollar is giving back quite a decent chunk of its gains following the US retail sales data yesterday.

USD/JPY in particular is down over 120 pips to near the 148.00 mark, with lower bond yields weighing. 10-year Treasury yields are down nearly 6 bps to 3.867% and that is keeping the yen more bid during the session.

In the last three days, traders could look to US data for some sense of reprieve on the economic calendar. But today, they have to look to themselves to pull things back up now. S&P 500 futures were up 0.2% early on but are now down 0.2% as we look to North America trading.

Going back to major currencies, EUR/USD is up 0.2% to just under 1.1000 with large option expiries keeping a lid on things there. GBP/USD is up 0.4% to 1.2905 while USD/CHF is down 0.6% to 0.8675 currently.

The dollar is struggling alongside the loonie, which is perhaps weighed down by weaker oil prices on the day. WTI crude is down nearly 3% as the rejection from $80 continues to stay the course this week.

In other commodities, gold is once again closing in on the key resistance region of $2,475-80 as buyers are teasing a breakout before the weekend comes.

This article was written by Justin Low at www.forexlive.com.

The dollar is now ceding quite a bit of ground in trading today, reversing the nudge higher after the US retail sales yesterday. It comes alongside a shove lower in Treasury yields. 10-year yields are now down 5.5 bps to 3.871% and that is weighing on the greenback. At the same time, US futures are also looking shaky as S&P 500 futures are also down 0.1% currently.

Going back to USD/JPY, the drop comes as price action stalls at the 38.2 Fib retracement level of the swing lower since July – seen at 149.42.

It’s going to be a tricky session for the dollar to navigate as traders will have to look to themselves to keep up the form from trading yesterday. There won’t be much on the economic calendar to help unlike in the past few days.

Looking to other dollar pairs, EUR/USD is up 0.2% to 1.0990 with large option expiries holding the pair near 1.1000. Meanwhile, GBP/USD is up 0.4% to test 1.2900 and USD/CHF down 0.6% to 0.8675 currently.

This article was written by Justin Low at www.forexlive.com.

• Will make great efforts to enhance the sustained upward trend of the economy
• It is necessary to stick to goals and not to take a relaxed approach
• Need to expand domestic demand more vigorously, focus on boosting consumption
• Will explore new growth points for foreign trade
• To make differentiated policy support based on the needs of different groups of people

Once again, it’s all pretty words and the challenge for Beijing will be to implement all of this on the ground level. That will be what investors are looking for in terms of shoring up confidence. Since peaking in 2021, Chinese stocks have plunged considerably amid the government’s handling of the pandemic and there hasn’t been much to convince of a revival in domestic demand just yet.

This article was written by Justin Low at www.forexlive.com.