Recently, Solana (SOL) has seen a notable price increase, with an 8% rise to $152 as of May 1. This growth comes accompanied by a 35% increase in trading volume and a 5% rise in futures open interest, indicating a strong demand for the cryptocurrency.
Several factors have contributed to this surge in price. Notably, Solana’s total value locked (TVL) has jumped by 25% over the past month, and daily decentralized exchange (DEX) volumes have skyrocketed by 90%, with platforms such as Sanctum and Raydium leading the charge.
Rising Futures Open Interest Fuels Momentum
The increase in open long positions in Solana’s futures market has played a crucial role in this rally. Open interest surged by 5% over the last 30 days, reaching 38.7 million SOL, which equates to approximately $5.86 billion in futures positions. This positions Solana third in the cryptocurrency market, surpassing XRP derivatives by more than 50%.
Additionally, the positive funding rates observed in perpetual futures markets have also contributed to the upward momentum. After flipping from negative to positive, funding rates now represent growing optimism among traders, implying a robust influx of capital into the market.
Revitalized On-Chain Activity
As the second-largest layer-1 blockchain, Solana boasts over $8 billion in total value locked, as reported by DefiLlama. The data reveals that Solana’s TVL has experienced a remarkable 25% increase in just 30 days, bolstered by significant deposits into platforms like Sanctum, Kamino, and Jito.
Moreover, Solana has surpassed the Ethereum layer-2 ecosystem in the past week, achieving a DEX activity volume totaling $21.6 billion, showcasing its dominance in decentralized trading.
A V-Shaped Recovery in Sight
Solana’s recent price action depicts a V-shaped recovery pattern on the weekly chart. This bullish formation signifies a sharp rise following a steep decline, with the potential resistance region noted at $160 to $200. A breakthrough in this zone could pave the way for Solana to reach the neckline at $250.
Should this V-shaped pattern complete successfully, the next notable resistance would be at Solana’s all-time high of $294, representing an impressive 92% increase from current levels.
The current market indicators, including a rising relative strength index (RSI), which has climbed from 36 to 47, support the notion that bullish momentum is gaining traction.
In conclusion, the recent surge in Solana’s price is a culmination of increased trading volumes, the rise in futures open interest, and revitalized on-chain activity. As traders and investors continue to monitor these developments, Solana stands at a pivotal point in its recovery journey.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
