Crypto traders have spotted a bullish pattern forming on Solana’s price chart, suggesting a potential price rally after the asset surged by 17% over the past week. The pattern in question is a bullish pennant, which typically indicates further upward momentum.
Bullish Pattern Emerging
On July 18, trading resource CryptoBusy highlighted the formation of a "HUGE PENNANT" on Solana's daily (1D) chart. This pattern develops when the price consolidates within a triangle-shaped structure following a strong upward move, hinting at a potential breakout.
“Watch out for this price action,” CryptoBusy advised. Similarly, the trading account InvestAnswers noted that “Solana is still showing impressive strength” relative to the broader cryptocurrency market.
Market Performance
Solana has demonstrated significant growth among the top ten cryptocurrencies by market capitalization, trailing only behind XRP. Over the past seven days, Solana (SOL) increased by 17.01%, while XRP grew by 23.57%, according to CoinMarketCap data.
Current Trading Insights
As of the time of publication, Solana is trading at $160.94, surpassing its short-term target. Crypto trader Honey cautioned against overleveraging the asset, emphasizing the current market uncertainty.
“This is a pivot area and I’d be cautious with longs if you’re entering here,” she wrote to her 105,600 followers on X, advising them to “go easy on the leverage.”
Futures Market Activity
Futures traders are expanding their positions in response to the bullish pattern. Open Interest (OI) — a measure of the total value of all outstanding Bitcoin futures contracts across exchanges — has risen by 22.14% to $2.13 billion over the past ten days, according to CoinGlass data.
Potential Price Movements
Honey indicated that Solana could potentially rise to $192 but warned that it could also fall to $140 if it fails to maintain its current level. A drop to this level would erase approximately $161 million in long positions.
Trader Perspectives
Crypto Tony, another trader, believes that the $160 level isn’t the critical support needed for a solid entry. He suggests that Solana needs another 1.3% spike to reach a safer entry point.
“Upticking nicely here, reclaiming $163 into support is the next goal,” Crypto Tony stated. “Above $163 is another level to reclaim for an easy, safer entry,” he added.
Conclusion
The emerging bullish pennant pattern on Solana's price chart has caught the attention of traders, indicating potential for further gains. However, caution is advised due to the current market volatility and the possibility of a retracement.
Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“