- Solana price bounce weakens at $33.15, casting doubts on the token’s ability to close the gaps to $38.50 and $48.50.
- Solana’s total value locked is a pale picture of its $10 billion November peak – implying more downside in the offing.
- Harrowing losses may engulf SOL price if support at $30.00 crumbles.
Solana price is scampering for support barely a day after reclaiming its position above $32.00. The competitive smart contracts token tagged an intraday high of $33.15 before dropping to exchange hands at $31.36. As discussed yesterday, SOL needs to recapture resistance at $36.50 to corroborate the climb to $38.50 and then to $48.50.
Solana’s DeFi TVL plunges to 2021 pre-rally levels
Defi Llama, a platform tracking the decentralized finance (DeFi) sector, reveals an enormous drop in Solana’s TVL from $10.17 billion in November 2021 to $1.42 billion. Although SOL’s 87.8% drop from historical highs of $259.96 cannot be entirely attributed to the massive drop in the TVL, its impact on Solana price is quite vivid.
According to CoinDesk, “investors look at the TVL when assessing whether a DeFi project’s native token is valued appropriately. The market cap of the token may be high or low relative to the TVL of the project. The more extreme the relationship, the more overvalued or undervalued the token may appear.”
Total value locked (TVL) refers to the overall value of crypto assets stored in DeFi protocols, mainly in USD. Smart contracts play a key role in this crypto segment, enabling staking, lending and liquidity pool features. In other words, Solana’s position in the DeFi market could provide investors with insight into price performance – not only for the native token, SOL but for other assets within its DeFi ecosystem.
Why Solana price pullback is far from over
Solana price could not sustain a reflex recovery on Monday despite wading through extremely oversold conditions. Besides, without a daily close above $32.00, a sustainable upside move would be a tall order for bulls.
Support at $30.00 is expected to prevent Solana price from exploring more downhill levels. Traders should keep in mind a sell signal from the Super Trend indicator, which might wreak havoc beneath $30.00.
SOL/USD daily chart
If push comes to shove and overhead pressure surges, recovery to $38.50 and $48.50 would be unmanageable. On the downside, investors may be forced to acclimatize to SOL retesting support at $25.00 and $20.00 sequentially.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Crypto Today: Bitcoin crumbles under German government transfers, Ethereum and Ripple erase gains
Bitcoin trades below $57,100 on Thursday as German government transfers continue, $76 million BTC moved to exchanges. Ethereum trades near $3,100 ahead of the upcoming SEC decision on the Spot Ethereum ETF.
Ripple traders take over $75 million in losses in July, XRP drops below key support
Ripple (XRP) price is under fresh selling pressure and tests key support at the June 7 low of $0.4508 on Thursday as whales are likely capitulating, according to on-chain data.
Bitcoin price declines as supply on exchanges rises
Bitcoin faced rejection at the daily resistance level of $63,956 on Monday, resulting in a 4.2% decline over the next two days. BTC’s price extends its downward move and falls below $58,000 on Thursday, adding more than 4% losses in the day.
Worldcoin is poised for 17% rally as as technical indicators signal bullish momentum
Worldcoin price finds support and bounces 9% from the weekly support level around $2.183. Technical analysis shows that WLD has formed a bullish divergence on a momentum indicator.
Bitcoin: BTC price correction could end in July, according to seasonal data
Bitcoin (BTC) price appears poised for a decline this week, influenced by slight outflows in US spot ETFs, selling activity among BTC miners, and a combined transfer of 4,690.28 BTC to centralized exchanges by the US and German governments.