Solana On Jet Fuel After Dropping To $222 Support Line

Olumide Adesina•Thursday, November 28, 2024•1 min read

SOL, the native token of Solana, has increased by 8% since dropping to $222 on Wednesday. Some investors are dubious despite this recovery, pointing to the steep decline from the stock’s peak of $264 in November. 23 could indicate a faltering bull run. On-chain and derivatives data, however, price action affirms SOL still shows the bullish trend is still on track

SOL holders concentrate on Solana’s solid fundamentals, even though it can be difficult to determine the precise reason behind the change in investor sentiment. The blockchain consolidated its standing as the second-largest programmable blockchain in user engagement and developer activity. Solana’s total value locked (TVL) increased by 48% in the 30 days preceding November, bolstering this expansion. 27.

SOL futures market shows that traders pay the highest annualized premium in seven months—23 percent—to hold long (buy) positions. Although this indicates optimism, overconfidence can cause this metric to rise above 40%, increasing the possibility of cascading liquidations during unanticipated price corrections. Additional price growth seems likely based on Solana’s on-chain activity and derivatives market data. SOL’s bullish run is still in play as the token is a 73 percent discount to Ethereum’s $429 billion market capitalization of $114 billion.

Ethereum is still the preferred network for decentralized finance (DeFi) opportunities, even though Solana controls meme coin launches and trading., Solana owns Raydium, Jito, and Pump, three of the top five highest-grossing DApps. fun—beating out Lido, Uniswap, and Aave, the top three Ethereum-related metrics.

Ethereum and Solana can expand separately without directly vying for the same user base. But Solana’s dependence on meme coins puts her at risk because the frenzied speculation surrounding tokens like BONK, POPCAT, MEW, and SPX6900—some of which saw a 100 percent increase in value in just three months—may not be long-term viable.

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Olumide Adesina

Financial Market Writer

Olumide Adesina is a French-born Nigerian financial writer. He tracks, analyzes, and reports changes in financial markets with over 15 years of working experience in investment trading.