Ethena (ENA) Price Shoots up 6%, Targets $0.50 This Week Amid Uptober Rally Chances?

With Bitcoin making a comeback above the $64,000 mark, the anticipation of an October rally in the crypto market is beginning to resurface. Amid the increasing bullishness, the Ethena Labs token, ENA, is ranking among the top performers. 

As a top performer, will the bull run in Ethena continue as the team suggests a new SOL-backed asset and a breakout rally? Read our price analysis now to know more!

Ethena (ENA) Price Analysis

With an intraday gain of 6.55%, the ENA token currently trades at $0.3817. The ENA price action reveals a short-term rounding bottom reversal by creating a second consecutive bullish engulfing candle. 

The price jump continues following the 26.64% surge last Friday. Currently, the altcoin is challenging a long-coming resistance near $0.3784, and a bullish closing today will mark a breakout rally. 

Furthermore, the ENA price action also reveals an inverted head-and-shoulder pattern, with a neckline coinciding with the overhead resistance level. Hence, the bullish breakout of this inverted head-and-shoulder pattern will result in a trend reversal rally for Ethena Labs. 

Ethena Proposes SOL as New USDe Backing Asset

The massive surge in the ENA token comes with the recent proposal over the Ethena Network recommending Solana’s SOL token as a backing asset for the USDe. 

This will utilize a similar hedging mechanism that Ethena already uses for Bitcoin and Ethereum perpetual futures. Considering Solana’s shorter trading history and lower liquidity, the allocation will be gradually introduced. 

Further, the speculations reveal a $2 billion open interest in Solana. The 2024 funding rates reveal a favorable condition with an opportunity to increase Ethena’s alignment with the Solana ecosystem and its network revenue. 

The proposal suggests a $100 million to $200 million SOL open interest, representing 5-10% of the Solana market. Furthermore, the addition of Binance and Bybit Liquid Stakes SOL, BNSOL, and bbSOL, respectively, is also recommended to ensure that the overall SOL allocation does not exceed one-third of its volume. 

The proposal is subject to a unanimous vote on the Ethena Network, which the Risk Committee will conduct within the next seven days.

Technical indicators:

MACD Indicator: The bullish continuation in the MACD and signal lines leads to a positive crossover. 

Will The ENA Price Reclaim $0.50?

Based on the Fibonacci levels, the recovery rally is expected to reach the 23.60% Fibonacci level at the $0.50 psychological mark. Furthermore, the next bullish target awaits at the 50% Fibonacci level at $0.83, with a mild resistance at $0.66. 

On the flip side, the 50-day EMA is present as a crucial support of the ENA price trend at $0.30.

Will Ethena’s breakout rally reach $1 this year? Find out more in our ENA Price Prediction.