Solana has experienced a 15% ascent over the last seven days, breaking above the $100 level for the first time in four weeks. This increases optimism about the upside potential of the SOL price, given the solid network fundamentals.
At the current level, Solana has a $43.7 billion market capitalization, just below the valuation of its rival layer 1 token BNB. However, the BNB Chain holds a $3.54 billion total value locked (TVL), more than double Solana’s $1.64 billion, according to DefiLlama.
Top chains by total value locked. Source: DefiLlama
In addition, Solana’s ecosystem has seen a surge in demand over the past week. This includes other decentralized exchanges (DEXs), some non-fungible token (NFT) marketplaces, yield protocols, games, and liquid staking solutions.
Apart from Jupiter’s (JUP) airdrop success, other DApps built on Solana are witnessing substantial user growth, including MeanFi, MarginFi, Wormhole, Drift Protocol, Kamino Finance, and Jito.
This points to growing strength in Solana’s network activity, which is a positive sign for the Solana price.
Where is Solana price headed next?
After finding a launchpad from the $22 support level in mid-October 2023, SOL rose nearly 500% to set a swing high at $126.
As the approval of the spot Bitcoin ETFs in the U.S. turned into a “sell-the-news” event, SOL retraced downwards and now trades 20% below the Dec. 25, 2023 peak. At the time of writing, SOL was trading at $100, up 5.5% on the day.
The $120 psychological level and the $126 swing high are key levels to watch on the upside. Rising above this level would confirm a bullish breakout from this level, with $150 becoming the next target for the bulls.
SOL/USD weekly chart. Source: TradingView
On the downside, the RSI showed that Solana is massively overbought. As such, profit-taking could lead to selling pressure and Solana may drop downward.
Key levels to watch on the downside are the 50% Fibonacci retracement level below $80 and the $60 psychological level. However, Solana looks strong from a technical perspective, and a drop to $60 might be far-fetched for the short term, but not impossible.
