As other altcoins shine, Solana's performance has lagged, allowing the 'bears' to gain the upper hand.
If the bulls act quickly, the situation could reverse—but timing is everything.
The resilience of Solana [SOL] bulls is being put to the test. Despite three attempts to break free from a downward trend in less than a month, the stock price continues to struggle and decline further.
From the daily chart, it is clear how much the 'Trump surge' has impacted investors, with Solana's stock price hitting a historic high of $264 after three years of stagnation.
After such a strong rebound, one might expect long-term HODLers to cash out their SOL assets, but surprisingly, that is not the case.
Conversely, the steadfast belief of these long-term investors has sparked speculation about an impending economic rebound.
However, as SOL has already erased much of its post-election gains, the threat of further pullbacks looms large. Even the most steadfast HODLers may soon feel the pressure. The pressure from this downward trend may force decisions, and it might just be a matter of time.
The clock is ticking, and from this chart, the winners of the election cycle are clear, as shown by the percentage change over 30 days. Just one week after the results were announced, the market experienced a wave of excitement, driving certain assets to substantial gains.
Ripple [XRP] has emerged as a big winner, soaring to key psychological levels with a triple-digit increase. Even more impressively, it has surpassed Solana to become the fourth largest cryptocurrency by market capitalization. Clearly, Solana has fallen behind its competitors, but that doesn't mean all hope is lost.
Speculation about a massive rebound is increasing, with some predicting that SOL could reach a target price of $500 by the end of Q1 next year. Considering Solana's price movements, especially over the past three weeks, it is understandable to view the $500 target as somewhat exaggerated.
However, we cannot overlook the fact that Solana's volatility has historically paved the way for some massive gains. While it's still too early to make any definitive predictions, it is clear that anything is possible.
So, should you 'go long' on Solana?
The past three weeks have been the most volatile for SOL, with bulls and bears engaged in a fierce tug-of-war. After dropping to $236, bulls staged an impressive comeback, triggering a 5% increase in just three days.
Futures traders are taking action, pushing open interest (OI) to a record high of $6.05 billion.
However, the rebound did not last long, and OI has fallen to $5.16 billion. Therefore, if you are 'bullish' on SOL, proceed with caution.
Although the current price looks enticing, SOL has struggled to attract the same attention as other altcoins. However, hope is not lost. Long-term holders are steadfast, and with the right push from major players, a short squeeze could turn the tide. Since the bears dominate the perpetual contract market and are leveraging weak accumulation, this could flip the situation in favor of SOL.
But time is running out. If the bulls cannot gain dominance soon, long-term holders may lose confidence, leading to a price drop below $200—potentially a re-entry opportunity for strategic buyers.
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