to leave a comment.
▲ Solana (SOL) ©
While Solana (SOL) is barely holding onto the $100 support level, there's a forecast that it could drop to $70 if concerns about interest rate hikes and liquidity withdrawal materialize.
According to Watcher.Guru, a cryptocurrency specialized media outlet, on September 3 (local time), Solana recently corrected from $109 and is now stabilizing around $100. While its price has risen by approximately 37% over the past month according to CoinGecko data, its current price is 65.6% lower than its all-time high of $293.31.
This rally is analyzed as a result of Bitcoin (BTC) recovering to $80,000, leading a broader market rebound. U.S. President Donald Trump announced at a White House cryptocurrency event that the U.S. plans to make large-scale purchases of cryptocurrencies, including Bitcoin. This statement appears to have boosted investor sentiment, causing Solana to rise following Bitcoin.
The expansion of liquidity due to the U.S. Treasury's bond buyback was also cited as a driving force for the increase. The explanation is that liquidity supplied during the process of repurchasing government bonds flowed into the cryptocurrency market, supporting price increases. Solana plummeted below $10 in the aftermath of the FTX collapse in 2022 but has since shown strong resilience, hitting new all-time highs multiple times.
However, Watcher.Guru diagnosed that there is a high possibility of the cryptocurrency market undergoing a correction. This is because the possibility of an interest rate hike within the year was highlighted when U.S. Federal Reserve Chairman Kevin Warsh made hawkish remarks at the Jackson Hole meeting. Furthermore, the fact that liquidity supplied through bond buybacks could eventually be withdrawn was pointed out as a factor that would increase downward pressure on the market. The forecast is that even if Solana trades sideways for a while, if it falls below $100, its price could settle at the $70 level.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
Newsletter
Get key news delivered to your email every morning
to leave a comment.