Can SOL shine brighter in a BTC-dominated market?

TLDR

• SOL faces a major challenge at the $48 horizontal resistance level.
• Overbought RSI on daily, 3D, and weekly timeframes raises caution for new long positions.
• Major support lies between $37 and $38, making it an attractive entry point.
• Funding rates are positive but not excessively high, indicating a relatively healthy setup.

Disclaimer: Not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results. “One Glance” by Cryptonary sometimes uses the RR trading tool to help you quickly understand our analysis. They are not signals, and they are not financial advice.

Technical analysis

Following SOL breaking out from its bullish pennant pattern, we now see SOL moving into the horizontal resistance level of $48. This is a key level for SOL to get above. If it can, this opens the door for a move up to $80 over the medium term. 

However, the $48 is such a major resistance that we’d be surprised if SOL doesn’t have a more meaningful pullback from this level, particularly if BTC can’t break above $38,000. 

The RSI on the daily, 3D and Weekly are all majorly overbought, so we’re cautious about adding new longs/buys to SOL at the current price point. 

The major support for SOL is between $37 and $38. We would be strong DCA buyers at this price point. 

SOL 1D

SOL weekly

Market mechanics

The funding rate for SOL is positive, but not overly so, while the open interest is still high. And even with high open interest, this is still a relatively healthy setup. 

The mechanics for SOL suggest there can be more upside, although other trading indicators are massively overbought. 

Cryptonary’s take

If BTC continues, then SOL can get further upside, but it’s likely to underperform here, considering how much it’s already moved higher. 

If SOL does move lower, say sub $38, we would be aggressive DCA buyers for the long term. Due to the general market being somewhat overheated here, we would be cautious about adding new positions and await a more meaningful pullback.