Solana (SOL) Set to Reclaim Trendline Support Amid Surging Network Activity

• Solana’s [SOL] price action indicates a potential recovery of the trendline support lost in June 2024.
• Network activity on the Solana blockchain has seen a resurgence, reminiscent of levels last observed in March 2024.
• An analyst on the X platform highlighted the potential for SOL to retest recent highs, contingent on maintaining key price levels.

Explore Solana’s recent developments and potential price movements as network activity surges and analysts weigh in on future trends.

Solana Aims to Reclaim Lost Trendline Support

Since the commencement of the recent bullish cycle in late 2023, Solana [SOL] has demonstrated remarkable performance, witnessing a meteoric rise of over 850% by March 2024. This run saw SOL leap from $20 to an impressive $210, offering significant returns for investors. However, the second quarter of 2024 brought market headwinds that pressured SOL below $150, subsequently breaching a critical multi-month trendline support that had been in place since the previous year. As SOL eyes a recovery, the focus is on reclaiming this essential trendline support, leading to speculations about the altcoin’s future potential gains.

Analysts Weigh Potential for a New Record High

A prominent market analyst named Ansem has presented a bullish outlook for SOL based on the SOLETH ratio, which measures SOL’s price performance relative to Ethereum [ETH]. Ansem remarked, “The SOLETH chart looks exceptionally bullish, with both technical and fundamental indicators aligning perfectly.” The ratio has been increasing over recent weeks and stands to enter price discovery territory if it breaks the 0.06 ceiling. This growth suggests that SOL has outperformed ETH recently and could continue its upward trajectory if the SOLETH ratio surpasses 0.06.

Ansem remains optimistic about SOL retesting the $210 mark in this cycle, provided it stays above the $160 threshold. With a steady uptrend and solid fundamentals, the altcoin appears poised for further gains.

Impact of Network Growth on SOL’s Prospects

An analysis by COINOTAG has spotlighted a significant uptick in Solana’s network activity, particularly in total value locked (TVL) and stablecoin inflows. Data from Artemis revealed a surge in daily active addresses in July, peaking above 2.2 million, a level last seen in March 2024 when SOL reached its cycle high of $210. This increase in network traction could support a recovery of the previous trendline support.

Despite these promising developments, CryptoQuant data indicates technical indicators flashing overbought signals, suggesting a potential short-term price trend reversal. A key upcoming event that could influence SOL’s trajectory is the Federal Reserve’s rate decision on July 31st. A dovish stance might propel SOL above the uptrend line, while a hawkish announcement could delay this potential recovery.

Conclusion

In summary, Solana’s price trajectory hinges on reclaiming critical trendline support, bolstered by increasing network activity and favorable technical indicators. Analysts predict that if SOL maintains its current momentum above key price thresholds, it could retest previous highs. Nonetheless, impending market events, such as the Federal Reserve’s rate decision, will play a crucial role in shaping short-term price movements. Investors should stay informed and closely monitor these developments for potential investment opportunities.