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Solana (SOL) Breaking from Bitcoin Could Be Advantageous

2 mins
Updated by Ryan Boltman
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In Brief

  • Solana’s price has been declining gradually after failing to close above the $190 mark mid-May.
  • SOL holders are highly optimistic about a recovery, as evidenced by the fact that OI rose by $700 million in two weeks.
  • The correlation between Solana and Bitcoin is dipping, which, in the past, has been followed by a price rise.
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Solana’s (SOL) price could be on the path of recovery, provided it can sustain the bullish cues being flashed across the market.

One benefit of SOL is that the altcoin could break away from Bitcoin, the biggest crypto asset in the world.

Solana Investors Hope for Gains

Solana’s price could take after the investors’ optimism as they continue to boost the network. Evidence of their bullishness is visible in SOL’s Open Interest (OI). Open interest (OI) represents the total number of outstanding futures or options contracts that have not been settled. 

Over the past two weeks, this OI has risen by more than $700 million, from $1.7 billion to $2.4 billion. This sharp increase shows that investors are still pining for a price rise.

Solana Open Interest.
Solana Open Interest. Source: Coinglass

Secondly, the correlation between Solana and Bitcoin is also actively dropping. A drop in the correlation is generally considered to be a bearish sign since BTC’s rise helps the altcoin rise, too.

However, at present, this breakaway is a boon for SOL. The reason behind this is the historical instances where the altcoin rallied every time its correlation to BTC fell. At the moment, this correlation stands at 0.63, falling lower.

Read More: What Is Solana (SOL)?

Solana Correlation to Bitcoin.
Solana Correlation to Bitcoin. Source: TradingView

Since Bitcoin’s price too is observing consolidation and slow recovery presently, SOL could benefit by charting its own path.

SOL Price Prediction: Can It Climb Back?

Solana’s price failed to close above the $190 barrier again and has since declined. The altcoin is currently changing hands at $165 back under the resistance of $169. A bullish outcome seems possible if the aforementioned cues are to be considered.

This would require SOL to first cement $170 as a support floor, then flip $175 into support as well. Subsequently, a rise to $190 and a test of the resistance would be considered a successful recovery.

Read More: Solana (SOL) Price Prediction 2024/2025/2030

Solana Price Analysis.
Solana Price Analysis. Source: TradingView

However, if securing $170 and $175 as support floors fail, it would not be surprising to see SOL fall to $156. Losing this support would invalidate the bullish thesis for Solana’s price, sending it to $137.

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In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Aaryamann Shrivastava
Aaryamann Shrivastava is a technical and on-chain analyst at BeInCrypto, where he specializes in market reports on cryptocurrencies from diverse sectors, including Telegram Apps, liquid staking, Layer 1s, meme coins, artificial intelligence (AI), metaverse, internet of things (IoT), Ethereum ecosystem, and Bitcoin. Previously, he conducted market analysis and technical assessments of various altcoins at FXStreet and AMBCrypto, covering all aspects of the crypto industry, including...