Solana (SOL) Recovers to $105 After Falling to $96... Will the Rally Continue?

▲ Solana (SOL) ©

Solana (SOL) quickly rebounded to reclaim $105 after falling to $96. The market, which had plummeted after the Senate vote on the Clarity Act, a US cryptocurrency market structure bill, rebounded as it digested the Fed's interest rate hike, with SOL rising 5.6% in 24 hours. However, high interest rates could put pressure on risky assets, so maintaining the $96-$100 support zone in the short term was cited as key to sustained upward momentum.

According to Finbold, a cryptocurrency specialized media outlet, on September 18 (local time), Solana recovered to the $105 level after dropping to $96 amidst a general market decline. According to CoinGecko, the 24-hour increase rate reached 5.6%, and it has risen over 37% in the past month. The media analyzed that the recent sharp decline and rebound process were influenced by the Clarity Act vote and the Fed's monetary policy.

SOL showed weakness, following the general market downturn after the Clarity Act failed to pass in the US Senate. The media explained that some investors might have perceived this as a negative signal from the US government, potentially withdrawing funds from high-risk markets. Subsequently, after the Fed raised the benchmark interest rate by 0.25 percentage points, the cryptocurrency market, including SOL, rebounded.

The rebound after an interest rate hike was considered an unusual trend, given that investors typically tend to reduce their exposure to risky assets when interest rates rise. However, the media analyzed that the market might have already priced in the interest rate hike in advance, which could have created a slight rebound potential after the actual decision.

Uncertainty still remains in the short-term outlook. While the rebound seen after the Clarity Act vote is positive, high interest rates could weigh on a sustained uptrend. SOL was analyzed to be receiving consistent support in the $96-$100 range, and the possibility of fluctuating between the current price level and this support zone for the time being was suggested.

In the long term, the media assessed that Solana has shown high resilience in the market, noting that it fell below $10 after the FTX collapse in 2022 and has since recorded multiple all-time highs. Bernstein analysts predicted that Bitcoin (BTC) would recover to $100,000 by the end of this year, and the media suggested that if this scenario materializes, leading to a general market rebound, Solana could also reach $200.

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