Solana is up over 15,000% this year and many investors want to buy the coin amid expectations for continued momentum.
The huge spike in price is mainly due to an increase in crypto gaming and many successful NFT launches. Moreover, numerous developers have worked on projects on Solana over the years and this is creating a huge surge in demand.
Solana was down over 2% on Thursday and anxious investors who missed the surge are asking if this is the beginning of a sustained selloff or a rare opportunity to buy the dip.
What the Solana chart says
After a 20% rise in just two days, SOL is showing signs of slowing down on Thursday.
The RSI was in the overbought zone on Thursday and it is indicating a small correction.
A bearish RSI divergence can also be seen, this is a very strong indication that a correction will be coming soon.
A retracement to the 0.618 level can be expected and a bounce back from the $220 level should be seen.
For investors looking to buy SOL, an entry can be taken once a reversal is seen from $220.
A target can be set at a new all time high, and a stop loss below the zone at $190 can be kept.
Solana is a very strong coin fundamentally and could also be a great pick for investors with a long-term timeframe. However an entry should not be taken now as it is overbought and thus investors should wait for SOL to correct to $220.
After a small correction from current levels, investors can target the coin to charge towards a new all time high.