Market Direction

SOL eyes $162 after pullback

Published: Oct 2, 2024

SOL's open interest declined as the price pulled back, finding support at $143 with $162 resistance.

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

As the price has pulled back over the last few days, SOL's Open Interest has declined along with its Funding Rate (although it still remains positive).
This indicates that the move lower was driven by Spot selling and Perp Longs closing out.

SOL mechanics:

5. Solanas price chart with Open Interest and Funding Rates, highlighting Spot-driven selling and declining open interest in recent days.

Technical analysis

SOL rejected just shy of the major horizontal resistance at $162 and has since pulled back.
Price has now found support on top of the main downtrend line. It's a positive sign that the price will break out of a downtrend line and then pull back to retest that downtrend line as new support. This is known as a 'bump and run' pattern.
On this price pullback, the RSI has also reset back to middle territory.
The horizontal level of $143 we have just added in. This is potentially a local support for price.
To the upside, $162 remains the key level to break above.

6. Solana price chart testing resistance at 162, with key support at 143 and RSI showing moderate strength.

Cryptonary's take

Ultimately, SOL is still in a larger range between $120 and $162. We remain really constructive on SOL and the whole SOL eco-system, but we do not expect fireworks until there is a breakout above $162, although we think it could be on the near term horizon.

In the coming days, we expect price to be subdued and compressed in a tight range until Friday's labour market data. Upon that data might we get a more volatile move, and possibly to the upside as we expect the data to be positive.