The Solana (SOL) cryptocurrency has recently undergone a technical analysis by the renowned crypto expert, Scott Melker, also known as The Wolf Of All Streets (@scottmelker). In his appraisal, he pointed out a crucial support-resistance structure in Solana’s current market, emphasizing on a perfect bounce from an important technical level.
“An exemplary bounce off of $112 support. A double bottom could be confirmed with a break above $147, the swing high between the two bottoms. No one should label it as a double bottom until that happens. Regardless, a commendable bounce off of support with established resistance to observe,” Melker revealed.
The analysis shows SOL bouncing back from near $112, marking this point as a significant short-term support. For a bullish double-bottom pattern to be validated, Melker indicates a breakout above the downtrend line (approximately $130). If SOL surpasses this resistance, $147 will be a pivotal level to break through. Until then, he advises against prematurely declaring the formation as a confirmed double bottom.
Interest in Solana has grown considerably due to substantial unlocks. On-chain intelligence company, Arkham, reported on Thursday that “$200M OF SOL UNLOCKING TOMORROW. Tomorrow (4th April) is the biggest single-day unlock of staked SOL until 2028. Four accounts staked a total of $37.7M of SOL in April 2021, now up 5.5x at current rates.”
Another trader, NooNe0x, offered a more hopeful perspective, predicting that the bulk of substantial unlocks may be behind us, thus alleviating the supply overhang from locked tokens.
Large token unlock events, such as these, have historically been anticipated by traders and investors. This anticipation often leads to price stabilization and recovery post the unlock event. However, the actual outcome is heavily dependent on the selling pressure and the broader market sentiment at the time.
Meanwhile, Awawat, a trader and angel investor at APG Capital, warned that despite Solana holding above $100, it could still be in a vulnerable position. “SOL absolutely shrekt – broke 170 range low, bounced at 120 a few times – now holding above 100 but the ice is thin – last big unlock tomorrow – will bid sub-100 if given but this looks rough given the state of the trenches,” he shared.
At the time of writing, SOL is being traded at $115.
