According to Ali, a crypto analyst, Solana, the sixth largest cryptocurrency by market capitalization, might be shaping up into a textbook cup-and-handle pattern, a bullish technical formation that resembles the shape of a teacup, with the "cup" forming a rounded bottom and the "handle" creating a slight downward drift before an upward breakout.

Accompanying Ali's tweet was a screenshot of the SOLUSD weekly chart, which illustrated a "cup" with a rounded bottom and a "handle" currently shaping up.

Ali added that if this pattern is confirmed, this setup could propel Solana toward $3,800. At $125, this target represents a massive 2,940% surge from Solana's current prices. While this prediction might seem far-fetched in the short term, optimism remains in the medium to long term as cryptocurrencies gain traction.

Solana prices fell to their lowest point in nearly a year on Monday, dropping to $112 after falling for five days in a row since the weekend.

Solana was last trading at around $125, down 1.39% in the last 24 hours but still less than half its all-time high reached in January, being swept up in the broader crypto slump of the past two months. Solana has been the preferred blockchain for meme coin creators, many of whom have been hammered particularly hard during this time.

Solana's short-term outlook

While the cup and handle pattern, if validated, suggests a bullish long-term outlook, a recent technical development on Solana's daily chart is creating concerns among traders.

A death cross, which occurs when the 50-day moving average falls below the 200-day moving average, was recently seen on Solana's daily chart.

On March 12, the Solana price completed a "death cross" on the one-day chart, indicating growing weakness. If the bulls fail to defend the last support level between $125 and $110, the SOL price could drop to $80. On the other hand, Solana must hold support between $125 and $110 for a bullish reversal.

In a bit of positive news, CME is preparing to launch SOL futures contracts on March 17, which will be among the first regulated Solana futures to hit the U.S. market after Coinbase launched in February.