Solana (SOL) gained 10% on the weekly chart. Will it surpass $25?

Solana (SOL) has experienced a significant recovery in the past week, with a series of steady gains. Currently, SOL has increased by 10% and is actively traded at $21.80, indicating a slight increase in the cryptocurrency’s price.

It is important to note that SOL is still far from its all-time high of $260, but the recent upward movement has pushed its value above the $20 mark, suggesting promising signs of a continued bullish sentiment.

What’s Behind the Rise of SOL?

There are several factors that could have influenced the increase in SOL’s price. These include macroeconomic factors such as inflation and crypto regulation in different regions. Additionally, Solana has seen some success in adoption, with some ecosystems adopting the token and launching cross-chain bridges.

Related Reading: XRP Next Step: Here’s Why an Upward Move Could Be Likely

However, the most likely factor is the increase in DEX (decentralized exchange) volume recorded this week. Blockchain analysis platform DefiLlama reported earlier this week that Solana experienced a significant spike in DEX volume. According to the report, SOL’s DEX volume increased by over 80% and is ranked fifth in the crypto market. This development is likely to have contributed to the price action of SOL in the past week.

However, the Total Value Locked (TVL) has not responded to this upward trend and has remained stagnant since its decline last November following the FTX collapse. Currently, the TVL is around $275 million, with no significant increase in value despite SOL’s recent gains.

Solana (SOL) Price Outlook and Prediction

SOL is currently trending upward and continues to show positive price action heading into the weekend. However, the intermittent red candles on its weekly chart indicate that bears are active this week.

Looking at the technical indicators, the relative strength index is at 50, in the neutral zone between the oversold region of 35 and the overbought region of 75. The Moving Average Convergence/Divergence (MACD) is currently in the buy zone, which is a bullish signal. Additionally, the histogram bars are green, indicating a bullish trend ahead. If the bulls persist, SOL is likely to have a sustained uptrend in the coming days.

SOL is trading at $21.83 after finding critical support at the $15.43 price level several weeks ago. This puts the altcoin close to the $22.50 resistance level.

Related Reading: PEPE Bulls Losing Steam? Fatigue Appears to Undermine Price Rally

A break above the $22.50 resistance level will help boost its price and reclaim the $25 psychological resistance level. If this occurs, SOL will likely rally to the $23.00 resistance level after surpassing $22. However, a short-term price decline below $20 remains possible due to bearish external market conditions.

(This site’s content should not be regarded as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured Image from iStock, chart from TradingView

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