Solana's surge surpasses Bitcoin, will it break through the $120 resistance and settle at $130?

▲ Solana (SOL)/ChatGPT generated image ©

Solana (SOL) significantly surpassed Bitcoin's (BTC) growth rate and renewed its highest price since January, driven by its unique large ecosystem catalysts and 12 consecutive weeks of institutional capital inflow.

According to the investment media TradingNews on September 22 (local time), Solana traded at $117.28, a sharp 8.42% increase from the previous day's closing price, and touched a high of $119.48 during the day, closely approaching its year-to-date high. On the same day, while Bitcoin took a breather with a 0.56% increase to the $85,923 level, and Ethereum (ETH) and XRP (Ripple) followed suit, Solana showed unparalleled upward momentum. This suggests that Solana's independent momentum is activating, going beyond simply tracking the overall market.

The key drivers behind this rally are ZetaChain's swift approval for migration to Solana and network speed improvements. The ZetaChain community's approval of the migration to the Solana ecosystem brought Anuma AI to Solana along with token conversion. On September 18, the network's block creation cycle, or slot time, was halved to 250 milliseconds (ms), doubling throughput. Furthermore, the strengthening of its fundamentals has been demonstrated as Column Bank, a member of the U.S. Federal Deposit Insurance Corporation (FDIC), adopted Solana as its primary payment network, and the ecosystem's decentralized exchange trading volume leads the industry at approximately $20 billion.

The strong backing from institutional investors is also a solid support for the upward trend. U.S. Solana spot ETFs have recorded net inflows for 12 consecutive weeks, accumulating $1.44 billion and a total net asset value of approximately $1.74 billion. This accounts for 2.5% of the total market capitalization of $68.49 billion. Additionally, Forward Industries, which has been accumulating Solana as part of its corporate financial strategy, has secured approximately 8.16 million tokens, representing 1.39% of the circulating supply, thereby absorbing selling pressure in the circulating market.

Technical indicators and the derivatives market are also sending bullish signals, but a major resistance level is considered a short-term variable. During the breakthrough phase, a short squeeze (buying pressure occurring to liquidate or cover short positions) of over $21 million occurred within 24 hours, and the Elder Force Index soared to approximately 7.99 million. However, selling pressure is emerging near the $119 to $120 resistance level, where trapped sell orders accumulated during the sharp decline in January. Therefore, whether Solana can break above $120 based on the daily closing price will be a watershed moment for the success of the future rally.

Experts predict that if Solana definitively surpasses $120 based on the daily closing price, further gains could open up, reaching $124, and then $128 to $130. Conversely, if it fails to break $120, it may undergo a consolidation process around the 9-day simple moving average of $107.76 and $105.45. If the $105.45 support level collapses, a retracement could extend to $97, requiring caution.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. This content should be interpreted for informational purposes only.*