Solana (SOL) has witnessed a remarkable rally in the past week, showing a series of steady gains. Currently, SOL is up 10% and is actively trading at $21.80, reflecting a slight rally in the price of cryptocurrencies.
While it is important to note that the SOL remains significantly off its all-time high of $260, the recent move higher has pushed its value past the $20 mark, indicating promising signs of prolonged bullish sentiment.
What’s behind SOL Rise?
There are several factors at this time that could have influenced the increase in the price of SOL. These include macroeconomic factors such as inflation and crypto regulation in different areas. Additionally, Solana has had some success in adoption with some ecosystems adopting the token and launching cross-chain bridges.
Related reading: XRP Next Step: Here’s Why An Up Move Could Be Likely
However, the most likely factor is the increase in DEX volume recorded this week. Blockchain analytics platform DefiLlama revealed in a report earlier in the week that Solana had experienced a spike in DEX volume. According to the report, SOL’s DEX volume increased by more than 80% and ranks fifth in the cryptocurrency market. This development has likely boosted its price action in the past week.
However, Total Value Locked (TVL) has not reacted to this uptrend and has been stagnant since its fall last November after the FTX collapse. TVL currently sits at around $275 million with no notable increase in value despite SOL gains in recent days.
Solana (SOL) Price Outlook and Prediction
SOL is currently trending up and has continued its positive price action into the weekend. However, the flashing red candles on your weekly chart show that the bears are active this week.
As for the technical indicators, its Relative Strength Index is at 50 in the neutral zone between the 35 oversold region and the 75 overbought region. The moving average convergence/divergence (MACD) is currently in the zone buy, which is a bullish sign. . Also, the histogram bars are green and indicate that an uptrend is coming and if the bulls persist, SOL is likely to have a sustained uptrend in the coming days.
The 7-day SOL chart shows a bullish trend / Source @Tradingview
SOL is trading at $21.83 after finding critical support at the $15.43 price level a few weeks ago. This places the altcoin near the resistance level of $22.50.
Related reading: Do the PEPE bulls lose steam? Fatigue appears to undermine price rally
A break above the $22.50 resistance level will help propel its price to recapture the $25 psychological resistance level. If this happens, SOL is likely to rally to the $23.00 resistance level after breaking above $22. However, a price drop below $20 is still possible in the short term due to bearish outside market conditions.
(The content on this site should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk.)
Featured image from iStock, Chart from TradingView
This post Solana (SOL) posts 10% gains on the weekly chart
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