Solana Price Forecast: Can Bulls Breach Yearly High as Layer 1s Dominate Crypto Volume?

Solana price is trending across major platforms as it outshines the entire market regarding network performance, usage, and dominance. The price of SOL rose 6.2% to $193 during the early hours of Monday morning. The increase coincided with Bitcoin surpassing a key resistance level and overall market recovery.

Furthermore, Solana’s exemplary performance in handling millions of transactions every minute with minimal network outages has cemented it as a plausible layer 1 blockchain. This sentiment is reflected in the rapidly increasing market dominance of crypto assets.

L1s Dominate Trading Volume as SOL Outperforms BTC, ETH, and XRP

Santiment, an on-chain data analysis firm, shows that layer 1 blockchains stole most of the volume and dominated the markets over the past week. This was likely due to the market-moving events in that week. 

According to Santiment, Bitcoin, Ethereum, and Solana ended last week on a good note; their combined power volume surpassed others like Layer 2s and meme coins. 

📈 Trading volume has veered heavily toward Bitcoin, Ethereum, & Solana as crypto's topsy turvy week ends on a good note. It's common for market-wide growth to be powered by these layer 1's, then redistributed to layer 2's & more. This may be a likely outcome for this weekend. pic.twitter.com/KjW9dsyPRD

— Santiment (@santimentfeed) July 27, 2024

In the meantime, Solana outperformed Bitcoin, Ethereum, and XRP in terms of market dominance, rising 38% year-to-date (YTD). Bitcoin came in second at a positive 16%, with ETH and XRP losing 4% and 16% of their market dominance, respectively. 

Solana dominance shows signs of a breakout against Bitcoin dominance, further confirming the SOL bullish bias. Currently, the overall dominance of Solana in the market sits at 3.68%, up 1.72% in the last 24 hours. Solana fights with BNB for the third spot, as the latter’s dominance comes in slightly below 3.57%.

Solana Price Eyes New Yearly High With 28% Additional Gains in Sight

SOL price is trending upward with a significant bullish breakout above the previous resistance level of around $172. This shows a double bottom, a bullish reversal pattern that has finished forming, and indicates more potential upside movement.

The price of Solana is trending above the 50-day and 200-day EMA, which provide support levels around $159 and $137, respectively. There has been a recent consolidation of around $180, which makes it a zone of minor support. The SOL price prediction shows the asset is expected to inch higher and test the next major resistance around the $210 yearly high, with a target of $220. This may set it 8–28% above its current price level. 

The Relative Strength Index (RSI) is at 68.32, close to overbought territory and signaling strong bullish momentum. It also suggests caution for potential short-term pullbacks or consolidations.  The Chaikin Money Flow (CMF) is at 0.23, indicating strong buying pressure and positive money flow into the asset. Overall, technical indicators in our Solana price analysis remain bullish on Solana’s price.

Frequently Asked Questions (FAQs)

1. How does Solana's performance compare to other cryptocurrencies?

Solana has outperformed Bitcoin (BTC), Ethereum (ETH), and XRP in terms of market dominance. It has risen 38% year-to-date (YTD), while Bitcoin is up 16%, and Ethereum and XRP have experienced losses in their market dominance.

2. What are the potential price targets for Solana?

Solana’s price is expected to test the next major resistance around $210, with a target of $220.

3. What are Layer 1 blockchains and how are they performing?

Layer 1 blockchains are the base layer of a blockchain network, handling transactions and network security. According to Santiment, Layer 1 blockchains have dominated trading volumes recently, outpacing Layer 2 solutions and meme coins.

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Evans Karanja

Evans Karanja is a crypto analyst and journalist with a deep focus on blockchain technology, cryptocurrency, and the video gaming industry. His extensive experience includes collaborating with various startups to deliver insightful and high-quality analyses that resonate with their target audiences. As an avid crypto trader and investor, Evans is passionate about the transformative potential of blockchain across diverse sectors. Outside of his professional pursuits, he enjoys playing video games and exploring scenic waterfalls.

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