Solana ($SOL) is down some 27% from recent highs on news that FTX holdings will be remunerated to investors.

The fear is that much of the repurchasing happened via institutional investors and that these investors will want to sell now to recover their earnings.

I think that's the wrong take for institutional investors--as they typically have 5 to 10-year views. But it's worth considering whether prices have reached bargain levels.

1 The Alt-Coin Bear Market

Let's begin with some context. Presently, altcoins are in a bear market.

Below is some data from GlassNode, which suggests that the recent sell-off is matched only by 12 previous days for declines (since the last cycle).

Those happened during China's shuttering of $BTC mining and the bear market.

Perhaps we are experiencing something similar to the 2020 China event -- a bear within a bull run -- as the typical end to a bull market happens when $BTC begins to falter, but altcoins continue.

2 The $SOL Bargain

If the market is currently in a "mini-bear" then it might make sense to pick up some coins on the cheap. This is not for the faint of heart.

Presently, $SOL sits just above its 200-day simple moving average (SMA 200) line. If your plan is to buy now and sell when it closes below that line ... then we've reached an ideal risk-to-reward (R/R).

Note, you have a high chance of needing to sell tomorrow or the next day, but the trade set-up is there.

3 Other Alt-Coins

Market Vectors puts together a well-structured mid-cap index. It's obviously down year to date, but it does a marvelous job of outperforming when markets rise.

Below is a representation of what that index is holding. The top coins are exchange coins and $hype, $OM, $XRM, $PEPE, and $ONDO.

If we are near the bottom, I'd expect this basket to perform exceptionally well.

4 Concluding Thoughts

I don't think that the institutional players are going to start dumping $SOL. I'd be surprised, also, if this were the end of the bull market, as we then would never have had an alt-season.

Moreover, $BTC is well above its SMA 200 and most macro indicators are still positive.

Of course, it's the crypto world, so who knows. DYOR. NFA.

Happy Trading!

-Sebastian Purcell, PhD

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