Market Direction

Solana support holds strong at $203

Published: Nov 12, 2024

Solana’s ($SOL) breakout above $203 is promising, but with funding rates and leverage high across BTC and ETH, a pullback might be near. Here’s what traders need to watch next.

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.

SOL's Open Interest, by a number of coins, is at a new cycle high.
SOL's funding rate is 0.07% or 76% annually. This is very high. It can go higher, but this is very high.
Like BTC and ETH, we would expect a leverage flush out for SOL here. This doesn't mean price will collapse, but a 10% pull back from the highs is possible.

SOL's funding rate:

5. Solana funding rate and Open Interest chart with SOL price trend, highlighting high funding rates and potential pullback zones.

Technical analysis

A huge move up that's seen SOL breakout above its major resistance at $203$205.
Price became very overbought and has now pulled back slightly. What's really positive is that price is pulling back to $203 and now using that area as new support. Resistance flipped into new support.
To the upside, the horizontal resistance is at $220 and then the all-time high of $255.
To the downside, we would expect $190 to $205 to be a good area of support if there is a more meaningful price pull back.
The RSI was overbought but it has now pulled back. If price consolidates for a period of time (say a week), this'll reset the RSI without price needing to have a major pull back to reset it.

6. Solana price chart showing breakout above resistance with current support levels, potential resistance points, and RSI trendline.

Next Support: $190 to $203
Next Resistance: $220
Direction: Bullish
Upside Target: $220 (and then $255)
Downside Target: $190

Cryptonary's take

SOL looks good here, having broken out of all the major horizontal resistances and now potentially pulling back and using the $203 horizontal resistance as new support.

We expect price to remain range-bound at these higher price levels for at least a few days. But, this would be positive in our view as it would likely help to reset some of the indicators, and therefore allow the next leg higher. $190 to $205 should be a strong support zone.