Solana sellers should beware of this buy zone

Posted: September 10, 2023

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• Solana’s price action stalled at a key level of interest for buyers.
• Open Interest rose in anticipation of a price rebound. 

Solana’s [SOL] bearish downtrend saw the altcoin break the $20 psychological level on the daily timeframe. While bears extended their dominance, price has ranged around a key area of interest for bulls.

How much are 1,10,100 SOLs worth today?

However, a bullish rebound could be dependent on Bitcoin [BTC] breaking out of its ranging price action below the $26k price level.

Price action stalled at a zone of buying interest for bulls

Source: SOL/USDT on Trading View

A look southward showed that the $18 to $19 price zone has been an area with strong buying interest for bulls. The surge in the Chaikin Money Flow (CMF) on the daily timeframe signaled that swing traders could be preparing to bid strongly for Solana.

The presence of the bullish order block (OB) at the level further strengthened the possibility of a price reversal.

Although the Relative Strength Index remained under the neutral 50, its sideways movement showed that there was identical buying and selling pressure at the moment.

Therefore, a spike in demand at the bullish OB could see buyers quickly reclaim the $20 psychological level and target the $22 to $22.5 price zone.

Alternatively, a breach of the bullish OB could see sellers target the higher low of the previous bullish rally at the $16 price area.

Futures market reacted with decent rise in Open Interest

Source: Coinalyze

Realistic or not, here’s SOL’s market cap in BTC terms

Data from Coinalyze noted a moderate rise in the Open Interest, as price wavered around the $19 price level. The Open Interest rose by $11 million within the past day. This revealed millions of dollars flowing into the futures market in anticipation of a bounce from the $19 price level.

Similarly, longs held a greater portion of the open contracts on the exchange long/short ratio. As of press time, longs had a 51.33% share on the daily timeframe. Taken together, this could result in a solid upswing for SOL.

Source: Coinglass