Solana price up 50% in two weeks, but here's why $120 will be hard to crack

Solana (SOL) continued its two-week uptrend on March 30, rising, in part, owing to its integration with OpenSea, the world's biggest nonfungible token (NFT) marketplace by volume.

SOL price rises to multi-week highs

SOL's price gained 4.5% in the past 24 hours to around $117 per token, its best level since Feb. 11, 2022.

The coin's latest move upside pushed its two-week paper returns to over 50%. Nonetheless, SOL/USD is still down 30% on a year-to-date timeframe, risking pullback as the price tested its 200-day exponential moving average (200-day EMA; the blue wave) near $120 as resistance.

The 200-day EMA coincided with the 0.236 Fib line of the Fibonacci retracement graph — drawn from $266-swing high to $75-swing low. This adds another layer of selloff risks near $120, which will likely prove to be a hard level to break. 

SOL NFT transactions hit record high

OpenSea's decision to integrate Solana's NFTs into its marketplace on March 29 might have boosted SOL's price. The rally also coincided with Solana-based NFT marketplaces recording their best day in terms of volumes and transactions on March 29, according to data from Dune Analytics. 

The total number of transactions executed across these Solana platforms crossed 57,000. Meanwhile, their net valuation came out to be around 136,000 SOL, approximately $15.2 million at March 30's price, making it the largest daily transaction volume observed inside Solana's NFT ecosystem to date.

Interestingly, Magic Eden processed about 80% of the total reported transactions on March 29. The NFT marketplace, which recently raised $27 million in a Series A funding round led by Paradigm, has been consistently outperforming its peers across the Solana ecosystem since its launch in October 2021. 

But NFT sales volume downtrend remains

Solana NFT marketplaces have been underperforming in terms of sales volume, despite witnessing growth in their transactional activity.

The owner-to-owner NFT sales volume has dropped by more than 13% to $147.41 million in the past 30 days, according to data provided by CryptoSlam. Meanwhile, it has shed 30% compared to January's $202.19 million figure.

However, Solana is not alone with similar declines in NFT sales across other chains, noted Philip Gunwhy, a partner at sports NFT marketplace Blockasset. He adds that increased crypto regulations in the United States and China might have dampened the demand for NFTs as well.

Related: OpenSea set to integrate Solana in April, further expanding the NFT ecosystem

For instance, Ethereum (ETH), the leading smart contract platform, which hosts more than 90% of all the NFT volumes, witnessed a decline of nearly 38% in sales volumes in the last 30 days, almost thrice higher than Solana. 

Other blockchain projects, including Avalanche (AVAX), Ronin and Flow, also suffered 30%–60% drops in their NFT sales volume durin the same period.

"Clearly, the level of sales is proportional to the number of users, which is currently decreasing in the majority of marketplaces," Gunwhy explained.

"NFT market correlates with investor sentiment rather than fundamental factors, this is a trend that we cannot ignore for the time being."

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