Crypto traders are closely watching the emergence of a strong support line on Solana’s price chart, leading some to believe that this is the starting point for a “massive” rally in the near future.
“It looks like SOL has found support at $120,” veteran trader Peter Brandt wrote in a Sept. 20 post. Brandt was referring to Solana’s price action on the daily chart, which shows SOL consolidating in a rectangular pattern with $120 as the lower bound, which has acted as support since mid-April.
“This could turn into a rectangle that could lead to a big upside.”
A similar view is shared by trader TraderKoz, who noted that the price of SOL has successfully retested $120 three times recently, highlighting the importance of this level for buyers.
According to TraderKoz, those looking to go long SOL should wait for a retest of the area between $135 and $140.
According to CoinMarketCap, among the top ten cryptocurrencies by market cap, Solana has seen the largest gain over the past seven days, reaching 8.82%, ahead of Bitcoin (BTC)’s 6.45% gain.
According to cryptocurrency trader CryptoZhi, Solana is trading at $148.50 as of the time of publishing and appears poised to continue its “bullish momentum” towards a short-term target of $160.
Futures traders have also been expanding their positions amid the bullish setup.
Open interest (OI) — a measure of the total value of all open or “unsettled” futures contracts across exchanges — has risen 12.5% over the past three days to $2.34 billion, according to Coinglass.
Additional data from DefiLlama shows that Solana’s total value locked (TVL) has been declining since the end of August, though it has increased slightly over the past three days, from $4.66 billion on September 18 to $5.15 billion on September 20.
Similarly, data from the Dune Analytics dashboard shows that daily transactions on the Solana blockchain increased from 4,630 to 8,023 between August 14 and September 19.
Increased TVL and on-chain transactions mean that network activity and adoption continue to grow. Increased user interaction with the platform leads to increased demand for SOL, which is believed to have a positive impact on its price.
