Altcoins
Altcoins Following 2016 Patterns – Good News for Solana?
- Solana price has fallen more than 11% in the last 7 days
- Market Metrics and Indicators Suggest Rising Prices on Charts
The current market looks bearish for most cryptos, including top altcoins like Solana [SOL] who struggle to paint their cards green. However, looking at the macroeconomic outlook, things could turn bullish soon.
This is how it will happen, especially if altcoins follow a specific historical trend.
History could repeat itself again
CoinMarketCap data revealed that Ethereum [ETH]The price of has fallen by more than 4% in the last 7 days. In fact, other top alts like BNB and Solana saw declines of 11% and 12%, respectively.
Meanwhile, Mustache, a popular crypto analyst, shared a Tweeter highlighting an interesting development. The tweet rightly pointed out that altcoins are following a similar pattern to 2016-2017. During this period, the altcoin’s market capitalization consolidated for a time near its 2012 peak, before reaching new highs in 2017.
Similarly, in 2014, the market cap of altcoins was consolidating near its 2017 ATH. Therefore, if history repeats itself, investors may soon see altcoins, including SOL, reach new highs.
Will Solana lead the altcoin rally?
AMBCrypto then planned to analyze SOL’s on-chain data to see if it hinted at a bullish rally in the coming days. According to our analysis of Santiment data, SOL’s weighted sentiment improved after falling on June 9.
This means that bullish sentiment around the token has increased over the past few days. Additionally, its social volume has also remained high, reflecting its popularity in the crypto space.
Source: Santiment
Apart from that, the situation in the derivatives market also seemed rather optimistic for Solana. We found that even though SOL’s price was falling, its open interest was also falling sharply.
A decline in this metric generally suggests that the chances of a trend reversal are high. In addition, its financing rate has also decreased slightly.
In general, prices tend to move in the opposite direction to funding rates, which further indicates a possible bullish rally on the charts.
Source: Santiment
Finally, we then looked at the daily chart of SOL to see if market indicators also supported the possibility of a bullish breakout. According to our analysis, its relative strength index (RSI) remained below the neutral level. It nevertheless recorded a slight increase.
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A similar trend was also noted by the Chaikin Money Flow (CMF).
If these indicators and metrics pan out as expected, then it is very likely that Solana, along with other altcoins, will reach a new ATH in the coming months.
Source: TradingView