Solana’s SOL token has recently seen a remarkable upswing in value, thanks mainly to a surge of activity on top crypto exchange Coinbase. Over the past two weeks, SOL’s value has increased by more than half, with signals indicating a significant contribution from Coinbase’s platform.
The Coinbase Catalyst
Data from Kaiko, a financial data firm, points to an influx of nearly $1 million into SOL on Coinbase, showcasing a solid pattern of net investments. This trend on Coinbase is contrasted by the mixed signals from other exchanges like Binance and Kraken, which have only recently shown positive capital flows. Notably, South Korea’s Upbit exchange reflects a downward trend, with the investment flow for SOL in the red.
However, Coinbase is not just attracting casual investors; larger median order sizes suggest institutional investors may also be casting bids for SOL. This involvement of institutional players could be a significant force driving the current surge in Solana’s value.
Bullish Outlook for Solana
Arthur Hayes, the legendary ex-CEO of the BitMEX exchange, has openly shared his bullish position on Solana, purchasing SOL after its significant recovery from the market’s bottom. His investment move reflects confidence in Solana’s potential since the token rebounded significantly.
Despite the current enthusiasm, it’s worth noting that Solana’s Relative Strength Index, which measures market momentum, suggests that the token is currently in an overbought state. This indicator often precedes a market cool-off or correction.
Historical patterns suggest that SOL could face a price pullback of between 35%-50% after such peaks in RSI levels. At the time of writing, SOL stands at $39, showing a slight dip in the past day but holding steady in the immediate hour.
Traders seeking to enter the market should wait for Solana to stabilize at a higher support level, ideally over $40, to gather momentum for the anticipated upward move toward $50.