At press time, Solana rose 70% in the weekly period, having recorded losses of only 1% in the daily window. In fact, after hitting an ATH of $ 80.5, the token was trading just below the $ 75 price level, at press time. Looking at these figures, Solana, along with Cardano, seemed to emerge as one of the few cryptocurrencies that fully recovered from the May 19 crash.
SOL’s rise could be accredited for increased use of NFT and DeFi in high volume blockchain network. While the rally to the top was supported by strong volumes and price pumps, another factor was the skyrocketing social sentiment.
Growing retail euphoria
Solana surpassed Uniswap to become the 10th largest crypto by market capitalization and a large part of this run was attributed to the growing retail euphoria over altcoin.
Social volumes peaked during the rally, as expected, reaching all-time highs last seen in May. However, what was also notable was that the average mood of these mentions was overwhelmingly positive.
This was highlighted by Solana’s weighted social sentiment, which reached its highest level since March.
In addition, a report highlighted that SOL was the main word in Santiment’s social trends on August 18. By doing so, it gained more ground on crypto social media than any other alt.
This further highlighted that a superior position on social trends, coupled with extremely optimistic sentiments, are “both common markers of market euphoria and, by proxy, approaching price caps.”
Solana ready for another ATH?
When an altcoin is down, the market is generally more relying on bullish momentum. But what happens when the ATH is reached? Most of the time, once the all-time highs are broken, the selling pressure sets in. This causes the price to go down. The same was evident in the case of Solana, as its RSI stabilized in the overbought zone before heading south on the 4-hour mark.
Furthermore, the altcoin’s trading volumes fell by roughly 50% after hovering around 15 million between Aug 16-18. That said, while all the metrics skyrocketed along with the SOL price, development activity suffered a recession and posted the lows of March 30.
Other than that, most of the metrics showed a bullish signal by the token. In fact, Sharpe de Solana’s relationship, which was low compared to Ethereum, posted a rebound as well.
What this suggested was that SOL promised better and higher returns than the altcoin king. SOL holders, at the time of writing, were being compensated more than usual for the risk taken. Ergo, this seemed to be an additional incentive for participants to stay in the market. Therefore, increased buying pressure could lead SOL to a new ATH.
This is a machine translation of our English version.
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