Forex Analysis & Reviews: 29.11.2021 - Solana could become third...

29.11.2021 06:28 PM

Solana could become third force of crypto market on par with Bitcoin and Ethereum

Over the past few weeks, Bitcoin has significantly reduced its investment attractiveness, giving way to altcoins. The reason for this is called the technology of smart contracts, which is most profitably implemented in other cryptocurrencies.

This can be regarded as the first wake-up call for Bitcoin, as the market is increasingly focused on digital assets with a deep and extensive development of the ecosystem.

The main representative of the new trend, with the exception of Ethereum, is the Solana coin, which has made a significant step forward over the past six months and has every chance of becoming a full-fledged third force in the cryptocurrency market.

The prospects of the Solana project were assessed by one of the cryptocurrency market influencers, Sam Bankman-Fried, who believes that altcoin has great chances to increase its own capitalization due to the scalability of the network.

According to Solana experts, it is necessary to defeat its direct competitor Ethereum, whose scalability problems are already forcing developers to switch to Solana. At the same time, Sam believes that the transition to the ETH 2.0 model will not solve the problem, and therefore the altcoin has a real chance to "bite off a big piece of the pie" of ether.

In this regard, November has become a defining month for Solana, as the first decentralized platform was launched on the basis of the cryptocurrency and its first results look optimistic.

In addition, SOL is becoming a much more attractive project for retail traders, leaving Ethereum. This is due to the significantly increased transaction fees, and Buterin's rhetoric about this sounded too unconvincing. As of November, Solana is heading towards a market-leading transaction processing rate per second.

At the same time, note that under no circumstances will altcoin have enough potential to oust Ethereum, but the scale of the DeFi market allows it to become on a par with the main altcoin. Now the process of differentiating the ETH and SOL audiences is underway, and then, while maintaining the current trends towards the development of the ecosystem, Solana can successfully attract new users and not be inferior to ether.

Meanwhile, SOL/USD is trading at $207, which is an excellent entry point for the asset, which will soon resume its upward movement to new highs. This is evidenced by the impulse breakdown of the $205 mark, where the 0.5 Fibo level passes.

Note that the impulse went exactly at the Fibo level, but the sellers' attempt to return the price below $205 ended in failure and the asset formed another confident bullish candle, but with the prerequisites for a local correction. A breakdown of the $205 mark is likely to take place as part of a pullback after a strong impulse, after which the price will continue its upward movement. MACD is confidently moving towards the green zone, while the stochastic and relative strength index is signaling the burning eyes of the bulls.

The Solana project has clearly become the most promising in the cryptocurrency market in 2021 and, unlike ADA/USD, the altcoin has great potential for growth. Given the availability of transaction speed and the broad capabilities of the ecosystem, the cryptocurrency will strengthen its position in the market in December and begin its ascent to the third place in terms of capitalization in early 2022.

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*Disclaimer: The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.