Solana's (SOL) trend in the last 24 hours has been bullish, with prices swaying between an intra-day high and low of $190.88 and $183.36, respectively. Despite the bearish efforts, SOL was still bullish at press time, exchanging hands at $186.27, a 0.71% surge from the support level. 

SOL/USD 24-hour price chart (source: CoinMarketCap)

However, despite a 0.51% increase in market capitalization to $82,785,289,944, 24-hour trading volume plummeted by 25% to $2,882,868,722, suggesting that investors are taking gains or waiting for more information before making future market swings. This drop in trading volume may signify a brief slowdown in SOL's upward momentum, which might lead to higher volatility in the immediate term.

Solana's DeFi Sector Strengthens 

Despite recent price pullbacks, Solana's decentralized finance (DeFi) Total Value Locked (TVL) has been on the rise, reaching $4.6 billion for the first time since February 2022. This surge in TVL indicates growing confidence in Solana's DeFi protocols. Moreover, investors are increasingly turning to DeFi platforms to earn yield during price consolidation periods rather than exiting positions.

The bullish dynamics within Solana's DeFi ecosystem are further supported by the significant capital inflows of over $600 million during the recent price consolidation phase. This accumulation of capital indicates a strong underlying bullish sentiment among investors, positioning SOL for an accelerated price breakout when market demand surges.

Speculative Trader's Position

Speculative traders have been strategically positioning themselves for the next Solana price rally, which is evident from the surge in funding rates in the derivatives markets. The funding rate for SOL has increased from 0.01% to $0.04% between March 20 and March 29, indicating a dominance of long contracts and a willingness among leveraged long position holders to pay higher fees in anticipation of continued bullish momentum.

Additionally, active leverage positions data suggest that SOL short traders face potential liquidation losses exceeding $143 million if prices surpass the $207.5 mark. This scenario could trigger significant downward pressure on SOL price action. However, sustained bullish traction in the DeFi sector may mitigate such losses and drive prices to new yearly peaks above $210.

Solana as Ethereum's Successor

Celestia's Chief Operating Officer (COO) Nick White has boldly declared Solana as the heir to Ethereum's throne, citing its growing scalability and transaction volumes. White's assertion is supported by Solana's blocks filling up similarly to Ethereum's, indicating rapid adoption and increasing transaction throughput.

Solana's recent achievements, including reaching a $50 billion trading milestone on its decentralized exchange (DEX), underscore its potential to outperform Ethereum in terms of trading volumes. Despite facing significant stress due to high usage, particularly concerning priority fees and transaction scheduling, Solana has maintained stability, showcasing its resilience and potential as a scalable blockchain network.

SOL/USD Technical Analysis

On the SOLUSD 24-hour price chart, the Bull Bear Power (BBP) signal trend in the positive sector is forming higher bars, suggesting a bullish sentiment among traders. This might indicate that, despite the decline in trading activity, there is still significant purchasing demand for SOLUSD at its present price level. If the BBP indicator continues to indicate positive trends and buyers remain active, SOLUSD can hold its current price levels and extend its upward trend.

SOL/USD 24-hour price chart (source: TradingView)

However, with the Relative Strength Index (RSI) falling below its signal line at 57, there is a chance for a short-term correction or consolidation before another likely push higher. This pattern implies that, while SOLUSD has significant buying activity, there may be some profit-taking or selling pressure in the near future, so traders should place suitable stop-loss levels to safeguard their profits.