Solana (SOL) is winning its battle to become the premier layer 1 network behind Bitcoin. The $SOL price has been on a tear against most other cryptocurrencies, and has now surpassed its all-time high against $ETH. Is this usurping of $ETH market share set to continue?
$SOL looks to break the macro downtrend
Much like the price of $BTC, $SOL has been in a sideways and downwards consolidation phase since mid-March of this year. Like $BTC, the $SOL price has seen some big corrections, followed by big price rises, as it zigzags sideways.
However, where $BTC has made a steady series of lower highs and lower lows, the $SOL price broke its lower high sequence at the end of July with a $193 local high. It’s now up to the Solana bulls to make another higher high, followed by a higher low, and set a new uptrend.
$SOL breaks out on short time frame
Source: TradingView
As can be observed in the short term time frame, the $SOL price has recently broken the downtrend. A retest to confirm the break is still to be made, but if the price can take hold above this trend line on a daily time frame, the chances could be good of the price continuing upwards.
SOL/ETH pair makes new all-time high
Source: TradingView
However, it’s against $ETH where the $SOL price has made the most impact among the top layer 1s. In a range with its $ETH pair since December 2023, $SOL has finally broken out after 229 days inside. The current price level also breaks the SOL/ETH all-time high.
After such strong upward price movement, the $SOL price may need to come back and confirm the top of the range. If this is successful, look for $SOL to continue on up into SOL/ETH price discovery.
SOL/ETH price targets
Source: TradingView
Upside price targets for $SOL against $ETH are 0.09 ETH, at the 1.618 fibonacci, and 0.14 ETH at the 2.618.
The Ethereum market capitalization is still 4.1 x that of Solana. Nevertheless, this ratio has been reducing fast. At this rate, it could be that $SOL surpasses the $ETH market capitalization at some point in the next bull market cycle. Which horse will you be on?
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
