Solana Price Prediction: SOL Jumps 2% After Clarifications, But Will $145 Resistance Hold?

Solana’s price saw a notable rebound over the weekend, surging by 2% to reach $145. 

This price movement coincided with Bitcoin’s struggle to reclaim the $60,000 psychological level, which seemed to uplift the broader cryptocurrency market. The recent price increase also reflects a bullish sentiment for Solana, particularly as its co-founder, Anatoly Yakovenko, addressed circulating misconceptions regarding the network’s capacity and transaction fees. 

Clarification on Solana’s Network Capacity

Anatoly Yakovenko, the co-founder of Solana, took to social media recently to address a misconception about Solana’s network capacity, specifically regarding transaction processing. He clarified that contrary to some reports, Solana’s blocks are not full, which some had attributed to past network congestion issues. 

Yakovenko explained that while Solana has seen increasing demand, this has not resulted in full blocks but rather in users willing to pay higher fees to access specific states on the blockchain. This behavior is competitive, as users prioritize speed and exclusivity, often for financial gains. 

Wrong assumption!

Solana blocks aren’t full. People are willing to pay high fees to be first to access specific state. Adding additional capacity, with L2s or ZKPs, will not result in lower fees for those users.

People want to launch L2s so they can make a profit providing… https://t.co/3Ex8FCcK2I pic.twitter.com/VsThgpcK87

— toly 🇺🇸 | phone salesman (@aeyakovenko) August 17, 2024

According to Yakovenko, adding more capacity to the network, whether through Layer 2 (L2) solutions or Zero-Knowledge Proofs (ZKPs), will not necessarily lower fees for those seeking priority access. 

Solana Price Stability Amid Clarifications

Following Yakovenko’s clarifications, Solana’s price demonstrated stability above the $140 level. The price resilience could be attributed to the market’s positive reception of the explanation provided by Yakovenko. 

His comments highlighted that the current fee structure on Solana is more closely related to user incentives than simply supply and demand for block space. He further emphasized that the desire for L2 scaling solutions is driven by profit potential rather than merely supporting the network’s capacity. 

As of the latest data, Solana’s price is $145.88, reflecting a 3.84% increase over the past 24 hours. The cryptocurrency has a 24-hour trading volume of $1,639,432,788, and a market capitalization of $68,009,832,082, ranking it as the fifth-largest cryptocurrency by market cap. With a circulating supply of 466,207,760 SOL coins, Solana remains a significant player in the cryptocurrency market.

Source: CoinMarketCap

The price movement of Solana (SOL) over the past 24 hours shows a general upward trend, beginning around $140.59 and culminating in a rally to $146. This price action suggests increasing investor confidence, possibly driven by Yakovenko’s recent clarifications and other market catalysts. 

The late-day surge in Solana’s price points to heightened trading activity and suggests that the market may be reacting positively to the newfound clarity around Solana’s network capabilities.

Despite the recent price gains, technical indicators suggest a cautious market outlook. The MACD (Moving Average Convergence Divergence) shows a bearish crossover, with the MACD line falling below the signal line. 

Source: TradingView

This indicator in combination with negative histogram bars points at possibility of a downward movement. The RSI (Relative Strength Index) is still below 50; it is currently at 46.29 which means that Solana is currently in the neutral to a slightly bearish territory. This conservative tone stresses the need to monitor major support levels because their violations may trigger fresh selloffs.