Solana (SOL) has emerged as one of the best-performing cryptos over the past 12 months. Despite some bearish dominance since late August, SOL has managed to maintain key support around the $120 level. This critical price point has held steady for the past six months. As of early September, SOL’s price has shown signs of consolidation, suggesting sell pressure may be easing and accumulation could be underway.
As of press time, Solana is trading at $129.35, showing a minor upward movement of 0.39% over the last day. Since the last week of August, SOL bears have maintained control, pushing the price lower. However, the first week of September saw a consolidation in the price, with sell pressure easing. This suggests that accumulation may occur, indicating that some investors are betting on a potential price rebound.
The number of net long positions in SOL recently spiked to over 18 million at the $128 price level. This indicates growing confidence among bulls, who believe the market may soon favor them.
Volatility and Liquidation Risks
Market analysts at HyblockCapital revealed the risk of further liquidations if volatility increases. The brief dip below $128 may have already been part of a leverage shakeout. The support level has remained steadfast, reinforcing that buyers enter at lower prices.
Bitcoin Dominance Declines
Another factor supporting Solana’s stance is the decrease in Bitcoin’s market dominance. In the last week, Bitcoin’s dominance has been on the decline, and attention has been shifted to other cryptos, such as Solana.
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Transaction Volume Uptick
According to the on-chain data from DefiLlama, Solana has seen a decline in transaction volume since late August, though there was a slight increase last week. This rise in transactions suggests that accumulation may occur as the price consolidates around key support levels. A surge in liquidity during altcoin season could drive even more demand for SOL, particularly within its DeFi ecosystem.
However, if Solana continues its recovery, the broader market could see a ripple effect. Strong performance from a top altcoin like SOL may boost overall market sentiment, attracting investment into other digital assets. Should Solana’s momentum continue, it could help ignite a more significant rally across the cryptocurrency market.
