Solana price has been struggling to break above the key resistance level of $21.10 in recent days. Earlier in August, the digital asset faced a strong rejection at the critical resistance level of $25.45, capping gains above the trendy $30 level. Even so, the smart contract token is one of the best performing cryptocurrencies so far this year, with a 102.61% jump in its price year-to-date. SOL’s total market capitalization increased by more than 5% in the last day to $8 billion, while the total volume of the asset traded in the same period increased by 40%.
Brighter future ahead?
The Solana price has faced significant challenges in 2022, including a 93% decline in its total market capitalization and a 96% drop in its total value locked (TVL). However, the SOL network has shown significant resilience in 2023, defying general market movements. Priority fees and network upgrades have contributed to a consistent 100% network uptime.
The Solana DeFi ecosystem has also seen a significant recovery, with a 41% increase in TVL. Its liquid derivatives also played a role in the asset’s resurgence. The ecosystem has expanded into other areas such as NFTs, gaming and consumer-based applications driven by technical advances such as state compression.
In particular, Solana recently admitted that the network is experiencing difficulties in the field of decentralized finance (DeFi). Even so, it believes that its new strategy will help it regain its base and attract a large number of users and investors to the network.
Solana plans to introduce token programs across various protocols within the ecosystem, which aim to reward and incentivize user contributions, thus encouraging active participation in the Solana DeFi network. Solana is also making efforts to improve TVL in its ecosystem, which has skyrocketed in recent weeks from $296 million to $312 million. With Solana having overcome the challenges of the past, the future looks promising. However, global economic concerns and general market movements remain a major concern.
Solana Price Technical Analysis
The Solana price has attempted several rallies in recent weeks, but all have failed as selling pressure continues to mount. The price of SOL is struggling to break the major hurdle at the $21.10 resistance level since early September. At the time of writing, Solana was trading 0.95% higher at $20.17.
Solana remains below the 50-day and 200-day SMAs, as well as the 100-day and 200-day SMAs, as seen on the daily chart. The Moving Average Convergence Divergence (MACD) is giving a “buy” signal, while the Relative Strength Index (RSI) is hovering around 54, indicating that buyers are gathering momentum.
Consequently, the Solana price outlook is still in limbo, and investors should be cautious when picking a side. A break above the $21.10 resistance level could lead to subsequent gains above the 200-day EMA at $22. Conversely, another rejection of the $21.10 resistance level could push the SOL price lower to the $19.15 immediate support level, thus invalidating the cautiously bullish position.