contributor
Posted:
- Why the latest SOL uptick could be the start of the next push towards key price levels.
- Evaluating Solana network’s health and why its recovery from August’s slump could play out well for SOL demand.
Solana [SOL] was finally showing signs of a bullish build up after going through a bearish weekend and a bit of uncertainty earlier this week.
Its performance suggested that a significant rally may ensue from its latest swing low.
SOL had already showed signs of recovery in the second week of September. This was after previously experiencing a wave of sell pressure since the last week of August.
However, the uncertainty around this week’s FED announcement may have disrupted its momentum briefly. The cryptocurrency has regained its recovery trajectory now that rate cuts have been confirmed.
The next significant short-term target for SOL should be around $150. Why is this? Well, SOL tops have for the most part been restricted to a descending pattern.
This puts it more-or-less within the $150 price range. This means the cryptocurrency might be due for another 10% upside from its $140 price range.
Source: TradingView
The cryptocurrency bounced by 11% in the last two days. SOL’s RSI has already pushed above its 50% level as at the time of observation. This confirmed that the cryptocurrency was gaining bullish momentum.
Given the nature of the latest catalyst (rate cuts announcement), there is a noteworthy chance that the market may experience major liquidity inflows.
Such an outcome could push SOL closer or above the $200 range within a matter of weeks, especially if Solana regains strong DeFi activity.
Assessing Solana network’s performance
The Solana network experienced a considerable slowdown in the last few weeks. This coincided with the dampened sentiment that prevailed especially in August and was evident in key Solana metrics.
For example, the network’s TVL peaked at $5.48 billion in August before falling as low as $4.66 billion earlier this month.
It bounced from the same level to $4.92 billion in the last two days, signifying confidence following the rate cuts announcement.
Source: DeFiLlama
Solana’s stablecoin marketcap was more severely affected by the recent slowdown. It peaked at $4.067 billion on the 23rd of August and has since tanked to $3.82 billion as of the 18th of September.
The decline in Solana network activity is also evident in its volume and transaction data. The network’s daily average volume was well above $1.5 billion and over 40 million daily transactions in July.
However, both metrics recorded a notable decline in August.
Source: DeFiLlama
Read Solana’s [SOL] Price Prediction 2024–2025
For context, on-chain volume dipped below $500 million and transactions briefly slid below 30 million at the end of August. However, there was some uptick in both metrics since the start of September.
These observations underscore the possibility of a comeback in Solana’s previously observed robust on-chain activity. This outcome that should technically fuel more demand for the SOL token.
