Solana (SOL) Recovers After Yesterday’s Dip: Why is it on the Rise?

Solana (SOL) continues to trade in the green despite the ‘flash crash’ experienced in the overall crypto market during the previous session, notching up gains and working its way towards newer ATHs. At the time of writing, SOL/USDT is trading at around $161.47.

The mood in the wider crypto sector turned bearish after market leader Bitcoin crashed under the $50,000 mark, causing most of the leading cryptocurrencies to register double digit losses over the past 24 hours. However, investors continue to trade Solana with a bullish bias, sending its price higher, possibly on account of its expanding footprint in the DeFi and NFT markets lately.

While a record high of over 334k SOL tokens were liquidated during the crash, according to analysis by Bybt.com, investors are not yet ready to perform very severe sell-offs in this cryptocurrency, believing in its potential as a strong contender to Ethereum. The demand for Solana’s ultra-fast blockchain network is on the rise among DeFi and NFT projects, helping support the price of its native token even through the strongly bearish sentiment in the crypto market.

Fundamental Developments Support SOL Price

One of the positive fundamental developments offering the SOL token some support is crypto exchange FTX’s announcement of its very own NFT marketplace which is integrated with Solana’s blockchain. FTX’s NFT marketplace went live earlier this week and supports cross-chain NFTs across Ethereum and Solana, and while Ethereum is not surprising because of its dominance in the space, it was a welcome surprise to see Solana being supported, raising investor confidence in its capabilities.

Solana’s price could also be trading higher after a venture platform based on its network, SolRazr, raised $1.5 million worth of funding to create the first decentralized developer ecosystem on its blockchain. SolRazr is a promising DeFi project that could become a key fundraising and developer platform for supporting new DeFi projects on the blockchain, allowing them to raise funds from investors quickly and in a secure manner.

Key Levels to Watch

Technical analysis of the 4-hour chart of SOL/USDT reveals a bullish bias among most of the moving averages. Although, the MACD and momentum are exhibiting a bearish bias as well at the moment.

Solana’s price is well above the pivot point at $128.73 and is currently holding just under the immediate resistance at $163.87. An uptick in buying pressure can see this level being broken, which opens the door for SOL to rise until $185.75, the next resistance level.