For the past two years, Ethereum (ETH) has been the dominant player in the crypto market, outperforming Solana (SOL) in terms of weekly chart performance. However, a technical analyst on X believes that this trend is about to change. CryptoGodJohn, a well-known analyst on the platform, suggests that now might be the “right” time for traders to swap their ETH for SOL before the next leg up that will push SOL higher in the coming years. While this claim seems promising, it remains uncertain whether this prediction will come true. Nevertheless, it is clear from the price charts that the path of least resistance is pointing northwards. Currently, SOL has surged by 71% against ETH since June, and a closer look shows that SOLETH prices are hovering around critical resistance levels, indicating a potential breakout in the near future.
The SOLETH chart reveals an interesting level of 0.0134 ETH, which has served as a significant liquidation level in the past, specifically in July and January 2023. If buyers continue to push the price upwards and breach the 0.0162 ETH level, accompanied by rising trading volumes, it would confirm the bullish sentiment seen in mid-July. In this scenario, SOL might extend its gains towards the 0.0265 ETH level, reclaiming the September 2022 zone. However, it is important to note that the immediate price action at spot levels remains uncertain. Currently, the weekly chart for SOLETH is experiencing rejection, highlighted by a long upper wick on the present bar, suggesting a potential sell-off in the lower time frames.
Adding to the complexity of the situation, the current SOLETH prices are still influenced by the bearish candlestick formed in early November 2022. This bear candlestick is characterized by a wide range and high trading volumes, signifying a rapid conversion of SOL to ETH during a period of fear. It is worth mentioning the collapse of FTX, a once-popular cryptocurrency exchange, during this timeframe. In 2021, FTX and Alameda Research, the trading wing associated with FTX’s CEO, Sam Bankman-Fried, invested a staggering $100 million in the Solana Foundation. However, with FTX filing for bankruptcy, concerns arose within the community regarding the potential sale of over 50 million SOL to repay creditors. The aftermath of the FTX collapse continues to impact SOL’s price, leaving the question open as to whether the digital asset can reverse the losses incurred during that time. If a reversal does occur, it could result in SOL gaining a significant 50% advantage over ETH.
As Ethereum and Solana battle for dominance in the crypto market, traders are closely watching the charts and considering the potential for a shift in momentum. While Ethereum has historically outperformed Solana, there are indications that this trend might be coming to an end. Technical analysis suggests that now could be the opportune moment to trade ETH for SOL, with the potential for SOL to experience substantial gains in the coming years. However, market dynamics are complex and subject to unpredictable factors. The SOLETH chart currently faces resistance, and the impact of the FTX collapse is still evident. Only time will tell whether this projected shift will materialize, and traders should exercise caution and monitor the market closely as they navigate the decision of whether to swap their ETH for SOL.
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