Solana price has been struggling to break above the key resistance level of $21.10 over the past few days. Earlier in August, the digital asset encountered a strong rejection at the crucial resistance level of $25.45, curtailing gains above the fashionable level of $30. Even so, the smart contract token is among the best-performing cryptocurrencies so far this year, with a 102.61% jump in its year-to-date price. SOL’s total market cap has climbed by more than 5% over the last day to $8 billion, while the total volume of the asset traded over the same period increased by 40%.
Brighter Future Ahead?
Solana price faced significant challenges in 2022, including a 93% decline in its total market capitalization and a 96% drop in its total value locked (TVL). However, the SOL network has posted significant resilience in 2023, defying general market movements. Priority fees and network upgrades have contributed to a consistent 100% network uptime.
The Solana DeFi ecosystem has also shown significant recovery, with a 41% growth in the TVL. Its liquid staking derivatives have also played a role in the asset’s renaissance. The ecosystem has expanded into other sectors such as NFTs, gaming, and consumer-based applications, driven by technical advancements like state compression.
Notably, Solana recently admitted that the network has been facing difficulties in the decentralized finance (DeFi) sector. Even so, it believes that its new strategy will help it regain its foothold and attract an extensive number of users and investors to the network.
Solana plans to introduce points programs on various protocols within the ecosystem, which aim to reward and incentivize users’ contributions, hence encouraging active participation in the Solana DeFi network. Solana is also putting effort into improving the TVL in its ecosystem, which has rocketed in the past few weeks from $296 million to $312 million. With Solana having navigated past challenges, the future looks promising. However, global economic concerns and general market movements remain to be a major concern.
Solana Price Technical Analysis
Solana price has attempted numerous recoveries over the past few weeks, but all have failed as the selling pressure continues to increase. SOL’s price has been struggling to break above the major hurdle at the $21.10 resistance level since the start of September. At the time of writing, Solana was trading 0.95% higher at $20.17.
Solana remains below the 50-day and 200-day simple moving averages, as well as the 100-day and 200-day simple moving averages, as seen on the daily chart. Its Moving Average Convergence Divergence (MACD) indicator is giving a ‘buy’ signal, while the Relative Strength Index (RSI) hovers around 54, indicating that buyers are gathering momentum.
Consequently, the Solana price outlook is still on the fence and investors need to be cautious when picking a side. A break above the $21.10 resistance level could lead to subsequent gains above the 200-day EMA at $22. Conversely, another rejection at the $21.10 resistance level could push the SOL price lower to the immediate support level of $19.15, thus invalidating the cautiously bullish thesis.