Solana (SOL) price is on the verge of breaking out of a double bottom pattern, signaling a potential upside of 20%. Growing interest from institutional investors appears to be the main driver of this rally.
The tide is turning in Solana’s favor
After a mixed first quarter of 2024, Solana is on the verge of regaining its momentum. This cryptocurrency, often presented as a potential “Ethereum Killer”, had somewhat lost the confidence of institutional investors. However, today it seems to be regaining ground.
According to the last report CoinShares' weekly SOL saw inflows of $4.1 million for the week ending April 26. Excellent news, considering incoming flows limited to $10 million since January.
This renewed interest from institutional investors could be the catalyst SOL needed. Thanks to its technological strengths and thriving ecosystem, Solana is once again attracting the attention of major players in the crypto market.
But institutional investors are not the only ones betting on the promising future of Solana. Individual investors also seem to anticipate an appreciation of the price. The evolution of the financing rate of perpetual contracts on SOL, which recently moved into positive territory and is constantly increasing, is proof of this.
This pattern reveals a predominance of long positions in the derivatives market, a strong signal that Solana holders expect the uptrend to continue.
A promising technical configuration
Beyond these favorable fundamentals, technical analysis also supports the hypothesis of an imminent increase. Currently close to $155, the price of SOL is moving just below a key resistance at $156, a level corresponding to the neck line of a double bottom reversal pattern, observable on the charts for a month.
If Solana manages to cross this resistance zone, this would open the way to an upward acceleration, with a theoretical target of $187 according to the double bottom theory, i.e. a potential increase of 20% compared to current levels.
However, it will be crucial to monitor the support at $138. A return below this threshold would call into question the bullish scenario and could cause SOL to fall towards $126 in the event of a breakout.
The tide appears to be turning in favor of Solana, which is benefiting from an influx of capital from institutional and retail investors. If the double bottom configuration is confirmed, SOL could experience a significant rally of 20% in the coming weeks. However, a failure below $156 would call this bullish scenario into question.
Maximize your Tremplin.io experience with our 'Read to Earn' program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.
