• Solana rallied in 2023, but failed to break above the horizontal resistance.
• A bullish case remains valid unless the price moves below the 2022 lows.
• If it breaks above horizontal resistance, Solana may trade above $40.
Solana Technical Analysis Update
Solana has seen a strong rally in 2023, with prices rising from $10 to over $25. However, after trading above $26 in January, the market has entered a period of consolidation and is yet to break past the key horizontal resistance level. Unless the price drops below its 2022 lows, there is still a bullish case for Solana as it could potentially trade above $40 if it breaks through this resistance level.
Key Horizontal Resistance Level
At present, one of the key metrics when analysing Solana’s performance is its horizontal resistance level at around $26. This level acts as an upper limit for how far Solana can rise before traders become hesitant and pull back their investments. In order to move higher than this point and establish a new base for growth, traders need to be confident that there will be sustained demand for Solana’s tokens over time.
Bullish Scenario Still Valid
The good news is that so long as the price does not dip below its 2022 lows then there is still a bullish case for Solana’s future performance in 2023. The market appears to have found some support at this lower band which suggests that investors are still interested in holding onto their positions and waiting out any further dips before committing more capital into buying up additional tokens. If demand continues then there is potential for the price to break through this upper barrier and reach levels beyond what was previously thought possible this year.
US Dollar Performance Key Factor
The US dollar has been experiencing mixed performance throughout 2023 which has had an impact on cryptocurrencies like Bitcoin and Ethereum as well as on smaller altcoins like Solana. A renewed period of dollar weakness could bode well for these digital assets and lead to increased demand from investors looking to diversify their portfolios away from traditional currencies or stocks & shares options. If such a trend emerges then it might give Solana enough momentum to finally break through its current ceiling of resistance at around $26 per token and push prices towards or even beyond the psychologically important target of $40 per token sometime later this year or early next year depending on market conditions at that time.
Overall, while it remains difficult to build a bullish case until we see whether or not prices can move past their current limits then all signs point towards further gains being made by Solana if certain conditions are met in terms of US dollar performance over coming months ahead alongside continued investor confidence in digital assets generally speaking across all markets worldwide heading into 2024