The SOL/ETH pair on Binance has extended its impressive winning streak, rising over 15% since Oct. 1. However, technical indicators now suggest that the rally may have gone too far, signaling a possible short-term correction.
Solana Looks Overbought Against Ethereum
SOL/ETH Pair Overbought on Strong Solana Momentum After posting gains for four consecutive months, the SOL/ETH spot pair hit a new high of 0.069 ETH on Wednesday.
The rally comes as interest in the cryptocurrency has renewed following a surge in Solana network activity. However, the 14-day Relative Strength Index (RSI), which measures the speed and magnitude of price movements, has climbed above 70, indicating overbought conditions.
The RSI is currently at its highest level since March, raising the possibility of a temporary pullback. A correction could see the pair retest the 0.064 support, corresponding to the high reached in August.
While an RSI reading above 70 is often associated with overextended rallies, it does not necessarily mean that the uptrend is over.
As traders often note, the RSI may remain overbought longer than the bears can remain solvent, implying that bullish momentum may still have room to grow.
*This is not investment advice.