Solana (SOL) price is at a critical juncture that will determine its direction in the upcoming weeks. If the SOL buyers successfully surpass the major resistance level, a potential surge of up to 40% is possible.
Critical Moment for SOL Price:
Looking at the 1-day chart using Fibonacci retracements, it is clear that the SOL price is currently at a critical juncture that will impact its performance in the coming weeks. As of now, SOL is trading at $19.19, slightly below the important 38.2% Fibonacci retracement level. The bulls have been unable to surpass the resistance level at $19.72 thus far.
Reaching the price level above $21, where SOL was trading prior to the announcement of the U.S. Securities and Exchange Commission’s classification of the Solana token, is a possibility if the current trend continues. Additionally, the 200-day Exponential Moving Average (EMA) at $22.05, often considered a significant indicator for bullish momentum, lies ahead. However, SOL investors have been unsuccessful in surpassing this level since April 2022.
In this optimistic scenario, the 200-day Exponential Moving Average (EMA) is seen as the second significant hurdle for SOL bulls. If this level is successfully surpassed, the price could advance towards the 61.8% Fibonacci retracement level at $27.00. This level also coincides with the year-to-date high, potentially indicating a rally of 40%. However, it is important to note that a temporary pause in the upward movement might occur around this level.
In a more negative scenario, if SOL is unable to surpass the 38.2% Fibonacci retracement level, a decline towards $15.30 becomes a possibility. This would result in a price decrease of approximately 21%.
Solana price stalls below 38.2% Fibonacci, 1- day chart | Source: SOLUSD on TradingView.com
Solana’s Strong Fundamentals Shine:
Solana’s recent price surge can be attributed to its robust fundamentals. On June 30, Solana achieved a significant milestone by surpassing Ethereum in 24-hour NFT trading volume. Solana NFTs experienced a remarkable increase in trading volume, reaching $25.5 million, which marked a staggering 1,900% day-over-day growth. In comparison, Ethereum’s NFT trading volume only grew by 28% to $24.6 million.
Another noteworthy development in the Solana ecosystem is the growing popularity of Drift Protocol’s “Super Stake.” This feature is generating excitement among risk-conscious traders. By utilizing Solana Staking derivatives, traders have the opportunity to earn an extra 10% return. Among the preferred derivatives is Marinade-SOL (mSOL) from Marinade Finance. With mSOL tokens as collateral, traders can borrow additional SOL tokens for ongoing restaking, effectively multiplying their returns by up to three times. This innovative approach provides traders with enhanced earning potential within the Solana network.
The Super Stake concept in Solana shares similarities with Ethereum’s MakerDAO and its stETH Yield Multiple Staking through Aave. Although it carries certain risks, there is significant demand for the Super Stake feature, driving up Solana’s overall usage and adoption. This demonstrates the growing interest and confidence in Solana’s ecosystem.
Super Stake Boosts DeFi Amid Thriving NFT Market : Super Stake is playing a crucial role in revitalizing the DeFi ecosystem, which has faced challenges in recent times. With the booming NFT market as a driving force, Solana’s ability to withstand these challenges, combined with innovative solutions like Super Stake, positions SOL for a potential bullish surge in the market.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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