- Summary:
- Solana's price rise has been phenomenal in the face of widespread crypto market decline. We discuss prospects of a return to the upside.
Solana price eased further down on Wednesday, as buyers ran out of steam to push the coin through two-week highs recorded on Tuesday. The SOLUSD exchange rate stood at $145.08 at the time of writing, down by 2 percent in the intraday session. The decline is a major disruption to Solana’s strong uptrend recorded in the last six days as it attempts to recover losses incurred in the last week of April.
Nonetheless, SOL is still among the best performing crypto assets in the last one week, with its gains standing at slightly more than 16%. Furthermore, it is the second-best performer among the top 10 cryptocurrencies, with it weekly gains only bettered by Toncoin’s 21%.
Solana’s upsurge in the last month is partly attributed to the good performance of Solana-based meme coins like BOME, Dogwifhat, and BONK. These tokens have brought increased activity in the Solana network, which has attracted significant investor interest. In addition, transaction fees have been rising on Solana in recent days, with some analysts projecting that it could soon overtake Ethereum fees. That would, no doubt help strengthen the narrative that Solana could potentially dethrone Ethereum in the near future.
However, Solana still has to convince investors that its network can handle high volume traffic with efficiency. That remains a key challenge for Solana, and it happened as recently as early April, when there was an outage that lasted for 5+ hours. There’s a risk that the same could be repeated if the crypto market rally kicks in on the back of the recent halving event.
Technical analysis
The SOLUSD market is currently controlled by the sellers, as indicated by the RSI. The pair pivots at 146.60. If resistance persists at that mark, SOLUSD will likely find support at 144.00. Furthermore, a continuation of control by the sellers at that point will likely break the support and potentially move SOL lower to test 141.20.
Alternatively, a moving above 146.60 will favour the buyers to push to 149.52, where they will encounter the next resistance. A continuation of control by the buyers at that point will likely break the resistance, thereby invalidating the downside view. In addition, it could potentially build the momentum to move further up to test 152.09.
