Solana Notches 16% Gains On Weekly Chart, Will It Cross $20?

Solana (SOL) has recorded progressive gains in the past week, with its 7-day high at 15.95%. It is currently trading at $18.73 today with slight gains on its price. Although SOL is still 92.61% below its all-time high value of $260, its recent gains in the past week have pushed its price closer to the $20 price level. 

SOL Price Outlook This Week Suggests A Bearish Trend

SOL is in a sideways trend this week, following positive price action in the last two weeks. It has formed a small red candle on the weekly chart implying that the bears are active this week. Also, SOL is still trading in the lower region of the Donchian Channel (DC), expressing a bearish sentiment.

Its Relative Strength Index (RSI) is at 45.60 in the neutral zone between the oversold region of 30 and the overbought region of 70. The RSI indicator reflects the sideways trend this week.

SOL’s Moving Average Convergence/Divergence (MACD) is slightly above its signal line and shows convergence which is a bearish signal.  Although the MACD displays a negative value, the Histogram bars are green, signaling a bullish recovery ahead. So if the bulls prevail, SOL will likely move to an uptrend in the coming weeks. 

SOL’s Key Support And Resistance Levels

SOL is trading at $18.73 after it found critical support at the $15.43 price level weeks ago. This puts the altcoin close to the $19.48 resistance level.

A break above the $19.48 resistance level will help to boost its price to reclaim the $20 psychological resistance level. If this happens, SOL will likely rally to the $21.81 resistance level after breaking above $20. However, a price decline below $18 in the short term remains possible due to its bearish outlook on the weekly chart. 

Factors Influencing Solana’s Price

There are several factors right now that could influence the SOL’s price. These factors include macroeconomic factors such as inflation and crypto regulation in several areas. Also, utility and adoption are vital factors alongside recent trends and developments in the ecosystem. 

Another trend in SOL’s ecosystem likely influencing its price action this week is its decentralized exchange (DEX) volume. According to a report from the on-chain analytic platform DefiLlama, Solana’s weekly DEX volume increased to see it rank fifth on the list at press time. 

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SOL’s DEX volume surged by 84%, and its 24-hour volume rose above $38 million. This increase will likely help to boost its price action in the coming week.

However, despite an increase in its total DEX volume, its Total Value Locked (TVL) is stagnant. DefiLlama shows that SOL’s TVL has been stagnant since its decline in November 2022 following the collapse of FTX.

The TVL is currently sitting at $273.26 million, with no notable increase in value despite slight gains in SOL’s price on the daily chart.

Featured image from Pixabay and chart from TradingView.com