Solana Sees 370% Jump in Open Interest: Can SOL Price Rebound?

Solana (SOL) has experienced a significant surge in open interest during the month of July, increasing by over 370%. This surge indicates a strong return of market interest in the cryptocurrency, potentially signaling a price comeback after SOL dropped towards $160. With more money flowing into SOL futures, investors are eagerly watching to see if this momentum can translate into a solid rebound for Solana’s price in the near future.

Key Metrics Show Strong Growth for Solana

July was a standout month for Solana, with activity in its futures market seeing a sharp uptick. Open interest on CME SOL futures skyrocketed by 370% to reach $400 million, while trading volume surged from $2.2 billion in June to $8.1 billion. This surge came just three months after the launch of the futures product and followed the introduction of the first Solana spot ETF with staking earlier in the month.

In addition to futures, Solana’s on-chain activity also experienced significant growth. Circle minted 11% more USDC on the network in July, bringing the total USDC supply on Solana to $12.2 billion. Stablecoin transfer volumes increased by 54% to $220 billion, with USDC accounting for $186 billion of that total. DEX trading volume was robust, averaging over $900 million daily, with USDC peaking at $1.93 billion.

Although open interest peaked above $5 billion on July 14, it later dipped to $4.6 billion following price corrections and liquidations. Furthermore, Solana maintained its position as the leader in transaction fees among all Layer 1 and Layer 2 blockchains for the tenth consecutive month, demonstrating consistent real-world usage.

An additional $690 million in assets were bridged to the network, and the meme coin “LetsBonk” surpassed Pump.fun as the latest viral token on Solana. Looking ahead, the price of SOL is likely to be influenced by increasing ecosystem demand and sentiment in the derivatives market.

What’s Next for SOL Price?

Despite recent gains, SOL faced resistance near its 20-day moving average at $175, causing the price to drop below immediate Fibonacci levels. As of the latest data, SOL is trading at $165, marking a decline of over 6.8% in the past 24 hours.

The next crucial support level for SOL is at $158. If the price rebounds from this level, buyers may attempt to push SOL above $185. A successful break above this level could pave the way for a climb towards $206.

However, if SOL drops below $158 and closes below that level, sellers could gain the upper hand, potentially pushing the price lower towards $125. This scenario would likely keep Solana within a wider trading range between $206 and $110 for the foreseeable future.

The Relative Strength Index (RSI) is currently declining and hovering around the oversold region at level 25. This indicates a potential comeback by buyers, possibly triggering a rebound rally for SOL price. It is essential for buyers to defend the 23.6% Fibonacci channel to sustain this upward momentum.