Solana's Price Surges 15% on Elevated Transaction Activity

Solana's [SOL] recent performance has been a subject of intense scrutiny, with analysts and investors closely monitoring its price movements. The cryptocurrency has seen a surge in transaction activity on-chain, which has provided a short-term bullish impetus, pushing prices above $120. However, the presence of a strong supply zone around $140 poses a significant challenge for bulls aiming to initiate a sustained long-term recovery.

One of the key factors driving Solana's recent performance is its outpacing of the Ethereum [ETH] network on multiple fronts. The SOL/ETH pair has made new highs, and SOL has seen elevated inflows compared to the Ethereum network. These factors have contributed to a bullish sentiment, with some analysts predicting that Solana could burst past $133 in the coming week. However, others remain cautious, pointing to the strong supply zone around $140 as a potential barrier to a sustained price rally.

The 1-day market structure for Solana looked bearish, but there were signs of a potential shift. The $143 level, which marked the lower high of the downtrend over the past three months, was identified as a critical level to breach for a bullish flip. Early indications suggested that this outcome could be achieved within the next week or two. The Relative Strength Index (RSI) climbed above the neutral 50 mark, signaling a bullish momentum shift. Additionally, the On-Balance Volume (OBV) was challenging the highs set in early March, indicating rising buying pressure that could propel prices beyond $143.

However, until the $143 level is breached, traders and investors are advised to remain cautious. The liquidation heatmap, with a 1-month look back period, highlighted $150 and $158 as the most significant magnetic zones nearby, containing over $2 billion in liquidations. The $136-$142 range also formed a considerable liquidity cluster. Further south, a notable liquidation pocket was observed at $95, but its distance makes it unlikely to be a short-term price target. Based on the heatmap and technical indicators, a move toward $150-$160 appears probable in the coming days.

Whether bulls can hold the $140 level as support and maintain their position remains uncertain. Success at this level could signal the start of a bullish trend, contingent on a Bitcoin [BTC] recovery and positive sentiment in the broader crypto market. However, the strong supply zone around $140 poses a significant challenge, and until this level is breached, the outlook for Solana remains mixed.