Highlights:
- Solana in the red and pushing towards $220
- Correction triggered by selloff across the market
- Strong intrinsic demand could support Solana and trigger a price rebound
Solana is in a correction today, following in the overall direction of the cryptocurrency market. When going to press, Solana was trading at $227.25, down by 10.57% in the day. This 10% intra-day correction has seen Solana’s market cap drop to around $107.84 billion.
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However, like Bitcoin, Solana trading volumes are rising today, up by 33.38% to hit a high of $7.30 billion. This reflects the frenzy in the market as long-term holders sell, panic sellers exit the market, and buyers looking to capitalize on the dip enter the market.
Technical Analysis – Solana Price Loses Key Support Level as Selloff Accelerates
From the charts, Solana is in a selloff intra-day. In the last 24 hours, Solana has lost a key multiple-day support at $232.19, and with high volumes. It is an indicator that short sellers are firmly in control of Solana. However, with Bitcoin appearing to trade at a key support level, Solana bulls are making a comeback but are yet to establish stable support.
If bulls regain control of the market, Solana needs to rally through the $238.80 critical resistance. In such a scenario, Solana could easily rally to the much-hyped $300 in the short term. If this does not happen and the current selloff continues the key level to watch would be the intra-day low of $224.46. A crash through this support level would open the way for Solana to drop to around $220 in the short term.
Of these two scenarios, there is a good chance that Solana could make a rebound. That’s despite the ongoing correction that appears all set to push Solana, along with other altcoins much lower in the short term. Several Solana-specific factors and the broader market support such a scenario.
Solana DEX Volumes Hitting All-Time Highs
Internally, Solana continues to be the blockchain of choice for all manner of Dapps. This is quite evident in Solana DEX volumes, which have now hit $100 billion for the first time in Solana’s history. Data from DefiLlama shows that yesterday, November 25, Solana DEX volumes hit a high of $109.8 billion.
Solana's fundamentals are at ATH.
It's the dominant chain by most metrics right now, and has the largest share of DEX volume.
It's currently ~29.5% of Ethereum's market cap, and is continuing to be repriced. $SOL will be heading into price discovery soon. pic.twitter.com/hcb0vFVfoX
— Aylo (@alpha_pls) November 17, 2024
This is significantly higher than the $55 billion Ethereum DEXs have recorded in the month to date. Such strong volumes are a reflection of the rising level of adoption of Solana and could play a role in its price action going into the future. It is a factor that could also help forestall any major correction for Solana relative to many other altcoins.
Bitcoin Rebound Could Push Solana Higher
Macro factors also seem to favor a potential end to the correction that Solana has experienced in the last 24 hours. One of them is the fact that Bitcoin appears to be finding strong support at around $93,000.
If this support holds, then a rally to $100k could follow as investors rush in to buy the dip. The result would be that altcoins would follow the momentum. For Solana which already has strong intrinsic demand, such a rebound for Bitcoin would put it on course to $300 in the short term.
Pro-Crypto Policies Could Fuel Institutional Money Flow Into Solana
There is also the overall expectation that the market will continue to do even better than it has done so far, once Trump takes over. That’s because he has promised crypto-friendly policies. Such policies are likely to inspire more institutional flows into Solana. With Solana ETFs expected to become a reality in the US in 2025, the odds are high that Solana could take in a sizeable chunk of that institutional money.
A Recap on Solana Price
Solana is in a correction today, trading in the overall direction of the broader market. However, rising volumes on DEXs point to strong demand for Solana and could help support the price. Bitcoin also appears to have found support at $93k and could help reignite bullish sentiment across the market, and that includes Solana.
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