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Highlights
- Solana price makes a 35% bullish comeback from Monday’s crash cryptocurrencies recovery.
- Solana DeFi TVL soars $1 billion from August 8, suggesting stronger bullish momentum.
- Declining liquidations in the futures market promise stability ahead of SOL’s breakout to $200.
- An upcoming death cross pattern may threaten Solana’s bullish outlook, calling for a correction.
Solana price has been making a solid bullish case since the crash on Monday, which saw the competitive smart contracts token retest levels last seen in early July. SOL’s new uptrend may extend further as more traders buy into the token over the coming days.
Solana Price Triggers Bullish Move
Solana price stretched the down leg to $109 in a candle wick on Monday, as seen on the daily time frame chart. The sell-off followed an initial correction from July’s peak of $193, coinciding with Bitcoin’s rejection of $70,000.
Unexpected liquidations in the futures market worsened the technical structure, suppressing bulls and energizing sellers. However, the rapid rebound above $120 called on traders who quickly bought the dip, allowing SOL price to regain momentum.
According to Coinglass data, liquidations have decreased significantly, from more than $1 billion of longs and shorts on August 5 to $120 million on August 7. This massive decline could mean that Solana is stabilizing ahead of a continued rally to $200.
A notable increase in the total value locked (TVL) from $3.8 billion on August 5 to $4.81 billion points to improving sentiment and drastically increases the chances of the Solana price reaching $200. Remember, increasing TVL indicates strong investor confidence, potentially driving the price up due to higher demand.
Navigating Solana Technical Structure
Solana price holds above the crucial 200-day Exponential Moving Average (EMA), which may continue providing much-needed support for a rally. The Relative Strength Index (RSI), at 43, moves higher in the neutral region, emphasizing a stronger bullish grip. Traders may want to ensure the RSI climbs above the midline (50) before going in on SOL buy orders. Some of the key targets on the upside include $160, $180, and $200.
Conversely, this Solana price forecast reveals an upcoming death cross in the daily time frame, which may weaken the uptrend. The bearish-centric pattern will form with the 20-day EMA in blue crossing under the 50-day EMA in red, encouraging traders to switch preferring to short SOL aiming for $140, $130, and $120 support levels.
Frequently Asked Questions (FAQs)
1. How does an increase in liquidations impact SOL price?
2. Can rising TVL boost SOL recovery?
3. Can Solana price rally to $200 this week?
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