Solana SOL price appears ready for a massive move upward over the next few days, based on a number of technical and on-chain indicators.
Data from DefiLlama shows Solana’s total value locked (TVL) increased to $1.9 billion on Feb. 19. The last time the TVL on Solana reached $2 billion was in June 2022.
The chart below shows that Solana’s TVL has increased by 244% over the last three months from $580 million in November 2023.
This increase in TVL has moved in tandem with SOL’s price which is up more than $100% over the same period.
On the shorter timeframe, Solana’s TVL has increased by over 40% over the last 30 days, beating other top layer 1 protocols such as Ethereum and BNB Chain, which have seen 30% and 19% increases respectively.
The rising TVL reflects traders’ interest in Solana’s DeFi ecosystem and shows Solana continuing to attract new users because of its lower traction costs, particularly those hunting for new airdrops.
Data from Solscan shows that Solana’s fees remain consistently low between $0.0001 and $0.0003, which is considerably lower than transaction fees on Ethereum.
Solana boasts a robust developer community, with over 2,500 active developers, highlighting its appeal as a blockchain ecosystem. Notably, it maintains a retention rate of over 50%, reflecting sustained engagement and fostering an environment conducive to innovation.
This developer community has led to the creation of a number of DApps on the layer 1 blockchain, giving rise to a foray of airdrops within the Solana ecosystem.
One of the largest Solana airdrops was (JUP) from Jupiter, the leading decentralized exchange (DEX) aggregator, which took place at the end of January.
This was a continuation of a revitalization of the Solana ecosystem in the second half of 2023 with major long-term projects on the protocol such as Jito and Pyth launching their tokens in November 2023 and December 2023 respectively.
This was followed by BONK, a Solana-based memecoin, which launched a large airdrop as a gift to the Solana community on Dec. 25, 2023. 50% of the coin’s supply was distributed to Solana artists and collectors as a way to support the creative community.
There are still a number of airdrops expected over the next few months, but it remains to be seen whether they will materialize.
Solana Upcoming Airdrops:@Parcl – Providing liquidity & longing good cities@Kamino_Finance – Providing liquidity in JUP Vaults (earns Meteora pts too)@MeteoraAG – Earning fees ($1 = 1000 pts) daily in DLMM pools & TVL@MagicEden – Exclusively using ME to trade NFTs & doing…— Litest (@LitestApp) February 11, 2024
SOL’s price is trading above the neckline of what appears to be an inverse head-and-shoulders (IHS) pattern.
The (IHS) pattern is a reversal technical setp that forms after an extended downtrend. It comprises if a head, a left shoulder and a right shoulder that are upside down and placed below a neckline.
A breakout and close above the neckline completes the setup, indicating that the downtrend has reversed.
The pattern typically resolves after the price rallies above the neckline, indicating that the downtrend has completely reversed. The SOL/USD chart below displays a similar technical bullish setup.
Notably, SOL rose above the neckline at $107 on Feb. 12, flipping the level into support. If the price holds aboveneckline, it will suggest the ability of the bulls to sustain higher levels. That will increase the offs of a break above $126. A decisive daily candlestick close above the $126 level could lead the SOL/USD pair toward the technical target of the pattern at $135, representing a 27% uptick from the current price.
The relative strength index was facing upward, and the price strength at 60 validated the dominance of the buyers in the market.
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.