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Solana (SOL) is a cryptocurrency project that is slowly becoming the best — or at least one of the best — options for developers throughout the crypto industry. The project was launched in early 2020, but it did not attract that much attention until early 2021.
It exploded after the rise of DeFi and NFTs, but the real reason behind its growth is the fact that Ethereum’s fees have become unbearable for anyone but the wealthiest, who could afford to pay gas fees that went up to $70 and more in May 2021.
After Ethereum’s fees hit their all-time high, developers and users alike started to leave. At the same time, this was the same period when Solana started seeing a major boost in inactivity and the value of its token.
Following the slow summer, the project started seeing a true rise that sent it up five times higher than the ATH it previously saw in May 2021.
Solana price in 2021
As mentioned, the SOL price started to grow in early 2021, going from $1.84 on January 1st to $17 on February 24th. By May 18th, the coin hit an ATH at $55.91, and while it did correct over the summer — going down to $24.45 at its lowest — it started seeing another surge after July 20th.
At first, its growth started slowly, and the coin took nearly a month to go from $24 to $44. But then, between August 13th and September 8th, the coin went from $44 to $191. This sharp rise to a new ATH had its consequences, however, and SOL corrected just as quickly as it surged.
The correction took it down from $191 to $123 in about two weeks, but soon after it, the coin was able to start recovering again. Its first attempt at recovery only took it up to $150 before it dropped again, this time to $130. The second attempt was more successful, taking SOL to $175, and then having it correct to $150.
The third attempt, however, led to an entirely new milestone of $210 on October 25th, after which the coin corrected to $183, only to skyrocket once again for one last time, and hit the all-time high that is still its largest record to date — $259. Solana hit this mark on November 6th, and while its price continued to fluctuate after that, the overall trend for the coin following this milestone was quite bearish.
Solana’s 3-month price drop
After reaching its peak on November 6th, SOL price started heading down. Its drop was first stopped by a support at $235 on November 11th, which even allowed it to attempt to recover slightly, to $241. However, given that the ongoing crash involved the entire market, SOL simply wasn’t strong enough to resist the bearish trend, and it got dragged down once again.
After dropping for 5 days, Solana found itself at another support, this time at $195. From here, it launched another short rally, and interestingly enough, it managed to recover quite a bit — initially. In three days, between November 18th, 2021 and November 21st, it managed to get back up to $231, only to get dragged back into the bearish wave and crash to $195 again.
While the support managed to hold it, the coin’s popularity was still powerful enough to allow Solana to try one last recovery, and this time, it even managed to hit a resistance at $235 before its price got rejected.
This next price drop was more severe than the others, and between December 2nd and December 14th, SOL lost around $80, ending up at $155.
At this point, the crash that sent the prices down had ended, and the holiday season was about to start, which gave investors the needed encouragement to start buying again. After all, historically, crypto prices did grow around the holidays, and the year before, in December 2020, BTC price did not only climb to its past ATH at $20k, but it managed to exceed it by nearly $10,000 and almost reach $30k before 2021 even started.
Encouraged by these facts, investors started buying and they pushed SOL price back to $200 by December 27th. Unfortunately, around Christmas, another crypto price drop started to spread throughout the market, and some coins were affected sooner, while others later. Many started experiencing drops days before the holiday, while others started dropping on Christmas day itself.
Solana was one of the few who managed to keep climbing until after the holiday, and its drop started on December 27th. This indicated that the community’s support was strong, as SOL did not take the first opportunity to crash. However, it wasn’t strong enough to keep pushing it against the market for long, and so starting on December 27th, Solana started a crash that took it back to the levels last seen in September 2021.
Solana continues to fall in 2022
On December 27th, Solana’s price was sitting at around $203, but by the end of the next day, the coin already dropped to $180, and by December 29th, it found itself struggling to stay above the support at $170. The coin spent the last few days of the year fluctuating between this support and a resistance at $180, and as we crossed from 2021 to 2022, the situation remained relatively unchanged. At least, for the first few days.
On January 1st, SOL was right under the resistance at $180, trying to breach it, but as days went by, its strength started to leave it. The coin finally returned back to its support at $170 around January 4th, and later that day, the support at $170 gave in. SOL price dropped right below it, and spent the next two days trying to fix that mistake, pushing strongly against the newly-formed resistance.
Unfortunately, it was not enough, and the coin quickly started to drop even further. By January 10th, it reached its lowest point on the YTD chart, dropping to $131. However, since then, SOL started seeing a slight recovery that took place over the last five days. From its lowest point reached on January 10th, the coin recovered to $157 on January 13th, only to correct once again to $145.
It spent the last several days at this level, and for the time being, it appears that it is stabilizing here. Whether or not that will last — still remains to be seen. However, it is clear SOL has the potential and desire to grow. The only thing stopping it is the bearish wave that took hold of the market ever since mid-November 2021.
To learn more about this token visit our Investing in Solana guide.
Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.