On Saturday (23), the price of Solana (SOL) hit a new all-time high, sparking speculation that the altcoin could rise to $300. While that hasn’t happened, recent data shows that Solana traders are betting on a recovery.
Why are traders confident? This on-chain analysis explores whether these positions can deliver gains or whether many are at risk of liquidation.
Solana bullish bets outweigh bearish ones
Data from Coinglass shows that Solana’s long/short ratio on the 1-hour timeframe has risen to 1.17. This indicator gauges market expectations, indicating whether the majority of traders are more inclined towards bullish or bearish positions.
When the ratio is below 1, it means there are more shorts (sellers) than longs (buyers). A ratio above 1 indicates that more traders are betting on a price rise than those predicting a fall.
Currently, 54% of Solana traders are long, while 46.17% expect the token to drop below $255. These numbers reflect a more optimistic outlook among traders, with a higher expectation of the token rising than falling.
Solana Long/Short Ratio. Source: Coinglass
Furthermore, it appears that these traders’ positions could prove profitable, thanks to an increase in Solana’s Transaction Rate, which is the number of successful transactions processed per second on its blockchain.
An increase in the Transaction Fee signals increased user activity and engagement with the cryptocurrency, while a decrease indicates reduced interest. According to Glassnode, Solana’s Transaction Fee has been rising. If this trend continues, it could push the price of SOL beyond its all-time high.
Solana Transaction Fee. Source: Glassnode
SOL Price Prediction: Upside Potential Remains
On the weekly chart, Solana price has risen above the 20 and 50 Exponential Moving Averages (EMAs), key indicators that measure trends. When the price is above the EMAs, it signals an uptrend, while a drop below them usually signals bearish momentum.
With SOL currently trading at $255, above both EMAs, the altcoin looks set to continue its upward direction. The formation of a bull flag further reinforces this bullish outlook.
A bullish flag is a continuation pattern, indicating that once the price breaks out, it is likely to maintain the previous upward momentum. As seen below, SOL has already broken out of the consolidation pattern and is moving higher.
Solana Weekly Analysis. Source: TradingView
As long as the price remains above the upper trendline of the consolidation phase, it can move higher towards $325. However, if selling pressure prevails, this bullish scenario may change. In that case, SOL may drop below $200.
The article Solana (SOL) Eyes Recovery Below $260 appeared first on BeInCrypto.
