Pseudonymous trader Altcoin Sherpa tells his 196,200 followers on the social media platform X that Solana is a fundamentally sound crypto project that could perform well in the next bull market.
Although the analyst is long-term bullish on SOL, he says that the road to get to bull territory will likely be bumpy.
“As a network, SOL is still a good one and will probably be a solid bet for the next bull run. I’ve got a long-term bag that I’ll just hold because I expect great multiples on it later on. But in the short term, it’s likely going to be painful.”
Altcoin Sherpa’s short-term bearish view stems from the idea that the defunct crypto exchange FTX could start liquidating its significant SOL holdings to pay back its creditors.
Court documents show that FTX currently holds about $1.16 billion worth of SOL.
According to the trader, FTX’s liquidation may trigger cascading prices that could send SOL to as low as $5.
“The next point of interest is the $17-$15.50 area. Lots of scared investors in regard to a potential FTX holdings liquidation.
Does this mean that SOL is done? No, in fact, I think this big sell-off (if it happens) creates a bottom for Solana. It’s one of the last big questions in regard to the big supply. If FTX gets liquidated, expect the price to capitulate to sub $10 ($5 maybe?), and then V reverse.”
A V-shaped reversal is a technical pattern where an asset witnesses a steep move down followed by a big move to the upside.
While Altcoin Sherpa says it is in the realm of possibility for SOL to reach $5, he says that the downside target is a “longshot,” and he would start accumulating the Ethereum challenger at $10.
At time of writing, SOL is worth $17.76.
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