- Solana continued to show bullish strength.
- Trying to reach the exact top can be counterproductive for traders.
Solana [SOL] bulls refused to bow to the bearish pressure. Even like Bitcoin [BTC] fell below the $70,000 level on March 15, while SOL trended higher. It crossed the $180 mark that day.
Dates of DefiLlama showed that the total value of Solana (TVL) has increased by more than 80% in the past month. It also recorded the highest DEX volume for the second day in a row, eclipsing Ethereum [ETH].
Should investors fear a pullback, or try to go with the trend?
Source: SOL/USDT on TradingView
Solana’s major retracement simply didn’t happen after January’s drop to $79. The RSI on the daily chart stood at 88, deep in overbought territory.
While it does not indicate that a pullback is imminent, it does indicate overheated conditions.
The OBV has been trending higher since late January. Buying volume has been phenomenal and SOL is up 26x from its 2022 low of $8. There was little resistance above $180.
The USD 259 and USD 276 levels were areas of interest, as was the USD 202 region. However, this zone could be retested as support as the market has been parabolic lately.
Analysis of the lower time frames showed that the support levels at $178 and $162 would also be critical.
A drop below these levels would indicate a bearish structure on the 1-hour time frame and a potential shift in momentum on higher time frames.
Speculative activity shows manic bullishness
Source: Mint glass
The Open Interest chart showed no signs of slowing down. According to Coinglass data, the OI behind Solana reached never-before-seen highs. This is accompanied by a price increase from $120 to $209 in just over a month.
Is your portfolio green? View the SOL Profit Calculator
OI increased from $1.71 billion on March 6 to $2.88 billion at the time of writing on March 18. This phenomenal increase indicated extreme greed, but did not stimulate short selling.
It also does not guarantee that a relapse is imminent. The local top was not there yet.
Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.