Solana (SOL) has made quite an impressive comeback after falling to $96 earlier in April. Over the last 7 days, the coin has surged over 13% pushing above the $150 price level. Achieving this threshold signifies positive optimism by investors with a potential bull run looming. 

But, the technical outlook of Solana shows that a correction may be just around the corner. However, the recent surge in stablecoin supply on the Solana ecosystem signifies Solana’s growing role in the DeFi sector. So, will the momentum hold or will SOL face a correction? 

Solana Makes Comeback to Above $150

SOL is regaining bullish momentum yet again as the general crypto market recovers from the tariff-war period lows. The renewed rally has pushed Solana $150 with over 1% surge on the day. In fact, the SOL/USDT 4-hour chart on TradingView shows that SOL is trading at $151.65 as of the time of this writing. 

Besides the prevalent momentum in the broader crypto, Solana’s rally can be attributed to institutional enthusiasm. Recently, Sol Strategies announced its $500 million note facility from New York-based ATW Partners to help in the purchase and stake of Solana (SOL). 

The deal represents the largest financing facility of its kind in the Solana ecosystem as the firm doubles down on becoming a leading institutional staking platform. Furthermore, it highlights how institutional investors are shifting their engagement with proof-of-stake (PoS) cryptocurrencies. 

Additionally, Solana is growing in real adoption with the ecosystem facing renewed memecoin interest. For example, Fartcoin has pumped by over 93% over the last one month as per Coinmarketcap data. Pump.fun has also positioned itself as a major memecoin platform in the crypto sector with significant revenue achieved in fees. 

Stablecoin Supply on Solana Hit New All-Time High

Amidst the recent surge in the price of SOL, the ecosystem is also facing heightened stablecoin supply. According to analytics on DefiLlama, the total Solana stablecoins market cap surged to $$12.885 billion. This level marks a new all-time high for the stablecoin supply on Sol. 

The data also shows that USDC is the leading stablecoin on Solana by usage, TVL, and liquidity. USDC, which has $9.89 billion in market cap, dominates on the Solana network with 76.76% dominance. Coming in second is USDT with $2.318 billion in market cap. Then Ondo US Dollar Yield (USDY) follows with a market cap of $173.91 million on Solana. 

The rise in stablecoin supply on Solana signals confidence and readiness for growth. Additionally, it signifies heightened liquidity in Solana. As liquidity expands, the blockchain is positioning itself for more significant adoption and use cases.

SOL’s Technical Indicators Suggests a Potential Correction

Besides the bullish outlook on the price of SOL and the surge in Solana’s stablecoin supply, technical indicators show that the coin could dip in the near future. The Relative Strength Index (RSI) for instance sits at 67.24 just below the overbought level at 70. 

While the RSI has dropped from 68.74 to the current level, it still shows that the crypto is nearing the overbought threshold which could trigger short-term profit-taking. A pullback may thus occur before continuation in an upward movement. 

On the other hand, the MACD also highlights an impending correction in the price of SOL. The MACD faced a bearish crossover recently with the MACD line falling below the signal line. However, lack of clear divergence between the two lines still shows weak momentum. Additionally, the histogram bars are negative hence suggesting a short-term dip could occur. 

Investors must thus be cautious regarding the price movement of SOL. These investors should monitor both the RSI and the MACD of Solana for a clear trend confirmation. Nonetheless, Solana is still cementing its position, especially in the DeFi sector.