0r is this just another case of FUD?
Recently an author on Cointelegraph.com stated that the price of Solana is poised for a 95% crash, let’s review some of the points the writer wrote about and any rebuttals that may be heard.
The article first stated that the token rallied 75% two months after bottoming out to $25.75, this upside has a risk of wiping out due to a bearish indicator that the author has called ominous. Of all the tokens that dropped during this bear market and after the fall of Terra, Solana actually has one of the highest bounce back rates. The token is currently trading at $38.61 which is lower than the predicted $50 but has not shown any signs of going back to the $25.
The author states there was a “head and shoulders (H&S) pattern that appeared which means three peaks with the middle peak being higher than that of the left and right peak in the graph. It should be noted that head and shoulders patters usually break below the higher spike , known as the neckline, which translates into saying that the price falls by the same distance between the peak of the tallest point and the neckline.
Head and shoulders patterns are usually correct 85% of the time unless the pattern for the right rises right before the “neckline”. This is not 100% and there are some instances where using Head and Shoulders may not necessarily work. This has been a very interesting bear market with some tokens taking a loss but bouncing back substantially.
Solana has been following the Federal reserve’s response to pressures on inflation as the trends of the token continue to be bearish. The Fed was mentioned to be slowing down the pace of interest rate hikes and with that Bitcoin and SOL both had similar raises in profit at around 10%.
The author stated that analysts have warned about price rallies in a risky market and states SOL’s 75% rebound risks turning into a fake out if there was a continued correlation with riskier assets.There is more to unpack here.
Solana has more going for it than some other blockchains, the NFT market on Solana is one of the most active with over $2 billion in sales to date with over 630k transactions last month alone. The CEO of Solana Labs Anatoly Yakovenko has recently introduced the Solana Mobile System and the SAGA flagship mobile device. Solana Pay is still being used in multiple new ways and gaming and multiverse projects built on Solana continue to dominate timelines on Twitter.
The sentiment is despite the issues the blockchain is facing there is far too much to be excited about than to fear a drop in price.
A 95% crash would indicate something akin to a rug pull and Solana is not a one and done project. The amount lost form pulling a stunt like that would be far more for the team at Solana Labs.
The author concludes by saying there could be a dip to $20 and create a multi-year ascending support trend line.
After the drop Solana could potentially begin a slow increase back up to a steady price , what the price will be has not been determined.
The price of Solana has seen a massive drop and many feel there is more to come but a 95% drop may indeed be too drastic of a prediction. In any event with all of the projects and collaborations coming to the blockchain, there’s definitely more to be excited about than not.
