Solana (SOL) reaches a new high, but should traders be concerned?

Solana is flying high, and the rally is unstoppable.

On September 7, the cryptocurrency market experienced a major sell-off. However, not Solana. After separating from the leading cryptoassets such as Bitcoin (BTC) and Ethereum (ETH), SOL has weathered this week's market correction to reach a new high above $214.

After achieving weekly gains of 80 percent, the remarkable rise came to an end. Solana now has five consecutive green candles in the midst of a market-wide sell-off. The ability to mitigate the impact of the ongoing bearish pressure highlighted investors' growing interest in the Solana blockchain, which is gradually emerging as a significant rival to Ethereum, the public ledger that has dominated the decentralised finance (DeFi) and nonfungible token (NFT) sectors in recent years.

Where is the price headed? That is the million-dollar question that remains unanswered. Will it experience the much-anticipated correction or will it consolidate?

What does the future hold for Solana?

The Awesome Oscillator's (AO) green ending bars indicated a tremendous bullish momentum in the coin market. Additionally, the MACD flashed green, and the dotted Parabolic SAR markers lined underneath the SOL price candlesticks.

The daily chart of SOL indicated a period of extreme volatility. Even if the volume of trading has not yet reached that of May, the increase has been moderate and not unstable. Following the remarkable increase, SOL crossed the demand zone of $92 to $65.

In a nutshell, the technicals are quite positive. The purchasing frenzy, however, pushed the daily Relative Strength Index (RSI) above the overbought zone.

As a result, the possibility of price flipping cannot be ruled out. In the event of a correction, the first support level expected to be tested by SOL is $139. On the other side, a period of market stagnancy may commence a period of consolidation at the current level prior to either direction's breakout.

Solana's Motivator

The need for Solana appears to be inexhaustible, owing mostly to the NFT projects that have sparked activity in the SOL ecosystem. With a massive money inflow, retain buyers are flooding the market. As a result, SOL saw its price increase by more than 50% this week and is spooked by the precipitous decline.

The blockchain community greeted the August 15 introduction of the NFT Degenerate Ape Academy, which featured a collection of 10,000 cartoon apes, sold out in less than 10 minutes, and involved 96,000 SOL, which roughly equates to $9 million. This is a tremendous accomplishment.

Solana's relationship with the NFT space is far from over. Indeed, one of the most significant milestones reached by the layer one solution ecosystem this week was the integration with the FTX-backed marketplace for digital collectibles.

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