The market rally that started a few days ago is beginning to show the first signs of weakness as most assets have flattened out in the short term. However, the huge increase in volume and the return of liquidity in the market could be a sign of an upcoming long-term reversal, especially needed for assets like Solana, Dogecoin and Ethereal.
Solana's Last Resort
Since the implosion of FTX, 3AC, Luna, and other notoriously troubled projects, Solana has been the punching bag for liquidators, having been widely used as a risk exposure tool by the companies they manage. CRYPTOCURRENCIES.
Although Solana actually put in an explosive performance in 2021, her move in 2022 can hardly be considered passable. Since January 2022, SOL has lost more than 86% of its value, triggering liquidations among many retailers and institutional. investors.
Following the liquidation of SOL de Alameda and FTX, the price of what used to be an Ethereum killer reached extreme values, making it unprofitable for almost 90% of investors. However, there is still some hope.
The unexpected recovery of the cryptocurrency market restored hope to Solana investors, who have been dealing with months of subdued performance by SOL in the market. The massive 120% recovery could become the foundation for further growth for Solana, especially while the NFT market is showing some impressive results in the background.
DOGE is building up
According to a number of on-chain and market indicators, whales have amassed a large amount of the market-leading meme coin during this market run. Although most analysts believe that the current market rally is mostly rigged, some whales are just following asset price performance rather than the reasons behind it.
The number of large transactions in the dogecoin The network is currently showing an increase of 11% in the last 24 hours. At the same time, the amount of DOGE in the addresses of investors is currently increasing. The two metrics are most likely correlated with each other and show that investors are actively buying Dogecoin during the price surge and not really caring about the potential premium they are paying now.
Ethereum Burn Recovery
The Ethereum burn mechanism in December and early January has had some serious problems, including the inability to cover existing issuance on the network due to a lack of activity on the blockchain.
According to the ultrasound.money service, the Ethereum network has been gradually recovering, with most of its network activity returning to pre-holiday levels. The issuance compensation at press time is 1.37x, while the annual amount of tokens burned reaches 855,000.
The price has reacted to this information accordingly, reaching a two-month high and attempting to break through the important resistance level of $1600. Unfortunately, it is not yet clear if the normal combustion reaction will be enough for Ethereum to function more efficiently in the market, but with the support of the combustion mechanism and the lockup period, we should see a reduction in the existing selling pressure. in the market. .
