A constellation of factors is currently influencing the rise in Solana’s (SOL) price. These elements range from macroeconomic components like inflation rates to cryptocurrency regulation protocols in various regions. Furthermore, SOL’s price performance is also being buoyed by its successful adoption, with several ecosystems incorporating the token and initiating cross-chain bridges. However, the dominant driving force behind this positive trend appears to be the increase in Decentralised Exchange (DEX) volume witnessed this week.
Blockchain analytics platform DefiLlama, in its latest report, indicated that Solana experienced a sharp DEX volume spike. The report detailed an over 80% surge in SOL’s DEX volume, placing it fifth in the global cryptocurrency market rankings. This increase is likely a pivotal contributor to its progressive price action observed over the past week.
Despite these encouraging signs, the Total Value Locked (TVL) has yet to respond to this uptrend. Following the FTX collapse last November, TVL has plateaued and currently stands at approximately R5.25 billion (USD 275 million), with no significant increase in value, irrespective of the recent SOL gains.
Solana (SOL) Price Trajectory and Prediction
Currently, SOL is trending upward, sustaining its positive price movement as the weekend approaches. However, the periodic red candles present on its weekly chart indicate bearish activity in the past week.
Examining the technical indicators, its Relative Strength Index (RSI) is positioned at 50, placing it neutrally between the oversold region of 35 and the overbought region of 75. The Moving Average Convergence/Divergence (MACD), at this moment, resides in the buy zone, sending out a bullish signal. Moreover, the presence of green histogram bars indicates an impending bullish trend. If this momentum continues, SOL could potentially maintain its uptrend in the coming days.
A breakthrough above the R428.25 (USD 22.50) resistance level could fuel its price to reclaim the psychological resistance level of R475.75 (USD 25). If this occurs, SOL could likely rally to the R438.21 (USD 23.00) resistance level after breaking above R418.28 (USD 22). However, a price fall below R381.40 (USD 20) in the short term remains a possibility due to potential bearish external market conditions.
For the burgeoning cryptocurrency market in South Africa, these developments on the international landscape hold significant implications. As the country’s crypto investors and enthusiasts are keeping a keen eye on such global trends, the price action of key players like Solana could influence investment strategies and regulatory discussions within South Africa.