- At press time, SOL’s price was defending a crucial support level
DeFi activity on the Solana network has been rising, with the TVL jumping by nearly $1 billion since 5 August
As a seasoned crypto investor with a knack for spotting trends, I find myself intrigued by Solana’s (SOL) current situation. At press time, SOL is defending a crucial support level, which has proven to be a reliable entry point for buyers in the past. The surge in DeFi activity on the Solana network, with TVL jumping by nearly $1 billion since 5 August, is certainly a positive sign.
On August 15th, during the Asian trading session, the broader cryptocurrency market saw a downturn. Consequently, the pessimistic atmosphere that followed caused Solana’s (SOL) price to decrease by approximately 3.8%, dropping it to $142 at the moment of this writing.
That’s not all though as SOL trading volumes also jumped by 28% in the last 24 hours.
Key support level to watch
On the price charts, Solana established a demand zone between $141 and $142. These levels are also acting as crucial support, with SOL bouncing each time these prices have been tested.
On the hourly chart, SOL surpassed the average level at $141 and moved beyond its purchasing zone. To ensure a lasting upward trend, it’s crucial that it continues to stay above these levels.
The backing served as an effective starting place for potential purchasers. Even though the Relative Strength Index (RSI) line was beneath the signal line, it still created a higher low, suggesting a bullish divergence. This indicated that the declining trend might be losing strength.
Despite the sellers holding significant control, indicated by an RSI (Relative Strength Index) at 41, there was a hint of increased buying interest suggested by the upward trend of the RSI line. Meanwhile, SOL remains predominantly bearish.
Using the Awesome Oscillator (AO), the bullish signal became more convincing as it produced a solitary green bar, suggesting a possible decline in bearish energy. However, at this moment, the immediate momentum continues to be subdued.
Indeed, the AO indicated a past effort to halt the decline, yet that endeavor proved unsuccessful. For SOL to maintain crucial support zones and continue upward momentum on the graphs, there’s a need for increased buying activity.
Surge in SOL network activity
Taking a walk through increased DeFi actions on the Solana blockchain might trigger the next wave of development, following the frenzy surrounding meme coins.
Information provided by DeFiLlama indicates that the Total Value Locked (TVL) in Solana increased significantly. On August 5, it stood at approximately $3.8 billion. As of the current reporting, it has risen to $4.75 billion.
The hike can be attributed to a rise in liquid staking activities. Liquid staking platform Jito dominated Solana’s DeFi volumes with $1.7B in TVL. Staking platform Solayer, which launched recently on the Solana mainnet, has hit $153M in TVL too.
This growth in DeFi activity could sustain a long-term uptrend.
Furthermore, Coinglass’s data indicates that Solana’s funding rates are now favorable. This suggests increased buying interest and optimistic market sentiments, as long traders are keeping their investments in the market.
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2024-08-16 03:07