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Solana Price Targets $120 as TVL Reaches 20-month Peak

Key Insights: Solana (SOL) price broke above the $100 milestone […]

Key Insights:

  • Solana (SOL) price broke above the $100 milestone of Feb 8, crucial market data trends suggest more gains could follow. 
  • Solana Total Value Locked (TVL) added over $500 million in the last two weeks, to hit a 20-month peak of $1.8 billion
  • The growth in DeFi TVL could open the doors for the bulls to stage a rally toward $120. 

Solana recorded a dramatic growth with its DeFi ecosystem over the past week, even leading to a brief network outage. On-chain data analysis highlights how rapid capital inflows and rising network participation rate could propel SOL price toward 0 in the days ahead. 

Solana Price Breaks Above $100 after a Week of Consolidation 

Solana has been the subject of major controversy and volatility in recent weeks. SOL prices ended January strongly with a blistering 35% upswing from $79 to $105 between Jan 23 and Jan 31, thanks to rising DeFi activity. 

Things took a negative turn on Feb 6, Solana network stopped confirming transactions.  The Solana blockchain experienced a 5-hour outage on February 6, 2024, triggering negative market sentiment.

Solana (SOL) Price action Jan. 23 to Feb. 8 | Source: TradingView

Interestingly, rather than enter a panic sell-off, bullish SOL holders held their positions. And on Feb 8, SOL price made another leg-up hitting the $105 mark  at noon Eastern time. 

On-chain data trends shows that this 33.6% price rally over the last 16 trading days could be attributed to Solana’s DeFi ecosystem attracting millions of dollars worth of capital inflows. 

Solana Total Value Locked (TVL) Hits a 20-Month Peak 

On Feb. 8 2024, Total Value Locked (TVL) on Solana’s DeFi ecosystem crossed the $1.8 billion mark for the first time since June 2022. As per DeFillama data, it has grown by a staggering $500 million in the last 16 days dating back to Jan. 23.

This milestone came on the back of projects built on the Solana layer-1 network that have made giant strides attracting investor attention in recent weeks. 

Solana (SOL) Total Value Locked | Source: DeFiLLama

While the Jupiter (JUP) decentralized exchange ($120M TVL) airdrop has arguably gained the most media notoriety, the likes of Jito ($771M TVL), Kamino ($371M TVL) and Blazestake ($269M TVL) have actually received the highest capital inflows over the past month. 

When a layer-1 blockchain network receives a boost in TVL as currently observed on Solana, it is a strong indication of growing investor interest in its native projects. 

As users of those projects begin to carry out their desired network transactions ranging from liquidity staking, lending to DEX trading, it elicits increased market demand for the native SOL token and ultimately drives up the price.

SOL Price Forecast: Clear Coast to $120 ? 

Based on the data trends analyzed above, the organic $500 million increase in Solana TVL has played a pivotal role in driving the 33.5% SOL’s price rally between Jan. 23 and Feb. 8. 

And with the TVL still trending upwards, SOL could be in line for further price gains, possibly retesting the $120 coveted territory in the days ahead.

In terms of key resistance points to watch, the upper Bollinger band technical indicator highlights that the bears could mount a sell-wall around the previous local top at $105.9.

Solana (SOL) Price Forecast, Feb 8 2024 | Source: TradingView

But, if the bulls can stage a decisive breakout above the area, an audacious move toward $120 territory could be on the cards. 

Conversely, the bears can invalidate this optimistic Solana price prediction if they can force a downswing below $80. But that currently seems far-fetched, with the lower Bollinger band indicator pointing towards a looming support buy-wall at $83. 

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