Solana Poised for Rally as Market Structure and Sentiment Suggest Bullish Continuation

• The 4-hour market structure was bearish, but the daily chart was bullish which hinted at a potential deeper retracement before a bullish continuation of Solana.
• Bitcoin continued to trade above the $20k mark, and Monday’s low at $20.6k served as support.
• There was a fair value gap to be filled on the daily chart in the $18.6-$22 zone, which could result in a dip before resuming the upward move.

The cryptocurrency market saw a surge in late 2020 and into the new year, with Solana (SOL) being no exception. SOL gained 212% in January and has been on a bullish run ever since. As of this writing, the price of SOL is trading just above the $23 mark. While the market structure on the 4-hour timeframe was bearish, the daily chart was bullish which hinted at a potential deeper retracement before a bullish continuation of Solana.

The overall market sentiment was also a factor to consider, as Bitcoin continued to trade above the $20k mark, and each passing hour reinforced the idea that a move upward to $22k was more probable than another dump toward $19k. Monday’s low at $20.6k served as support, and any lower timeframe deviations beneath this level have been a buying opportunity in the past two days.

Another factor to consider when assessing the outlook of SOL was the fair value gap to be filled on the daily chart. Marked in white, this FVG was seen in the $18.6-$22 zone. This meant that the price could fill this gap and dip some more to shake out long positions before resuming the upward move. Significant support levels lay to the south, even beneath the $18 mark. While it could be a good idea to bid at these levels, more risk-averse traders can wait for signs of short-term strength before entering the market.

All in all, the outlook for SOL was bullish, with the market structure and sentiment hinting at a move to the upside. The fair value gap on the daily chart could be a potential area of interest, as it could indicate a potential dip before a continuation of the rally. Risk-averse traders may want to wait for signs of short-term strength before entering the market, while those looking for a potential buying opportunity can keep an eye out for the FVG bottom at $18.6.