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Pseudonymous cryptocurrency analyst Altcoin Sherpa has recently raised concerns for Solana (SOL) supporters. Although SOL has seen a notable 8% increase from its weekly low, trading at $19.04 at the time of writing, Sherpa cautions that the digital asset is still experiencing a downtrend. Importantly, the cryptocurrency is encountering a significant resistance level around $19.50.
As per Sherpa, this scenario continues Solana’s bearish trajectory since reaching its 2023 high of $32.30 in July. He notes that each rally over the past few weeks has resulted in another lower high. “It’s encouraging to witness some recovery, but exercise caution,” he advises. Furthermore, he mentions that investors might consider accumulating at levels below $20 if they are focused on long-term investments.
However, there is a notable twist. If SOL cannot sustain its recent rally, Altcoin Sherpa anticipates that the $14 level could serve as a strong support. The critical factor is that Solana’s ability to remain above the $14 threshold is largely contingent on how the bankrupt crypto exchange FTX liquidates its substantial Solana holdings, valued at $1.16 billion. As a result, Sherpa believes it may take some time for Solana to establish a stable bottom.
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Additionally, investor Chris Burniske presents a different perspective. While recognizing the potential risks associated with FTX’s large holdings, he informs his 263,400 followers that only about 13% of FTX’s SOL assets are liquid. Burniske, a partner at the crypto-focused venture capital firm Placeholder, maintains a long-term optimistic outlook on SOL despite the concerns related to FTX.
In his opinion, every cryptocurrency carries its own challenges, similar to ETH and BTC, which have achieved new all-time highs despite obstacles. Therefore, the difficulties linked to FTX’s financial issues should enable investors to appreciate the long-term potential of Solana.
In conclusion, the future of Solana remains uncertain with multiple factors at play. With resistance levels, FTX’s unpredictable liquidation, and differing opinions from analysts, the upcoming months are likely to be an intriguing time for SOL observers.
The post Analyst Warns of Solana’s Downtrend Despite Recent Rally, FTX Factor in Play appeared first on BitcoinWorld.
