Solana price formed a doji candlestick pattern on Monday, pointing to a relief rally after Janover, a small publicly-traded company, started buying. The SOL token initially crashed to a low of $94.8, and then bounced back to $111.78 as investors bought the dip. So, is this the end of the Solana price crash or a dead cat bounce?
Janover to accumulate SOL tokens
One of the biggest Solana news of the week was that Janover, a company offering commercial property loans, business loans, insurance, and real estate syndication, announced that it would start to accumulate SOL tokens.
The company announced this as it announced a change of ownership and management changes. It will now be led by Joseph Onorati, while Parker White will serve as the Chief Investment Officer.
These individuals are part of a group of investors who acquired 728,632 shares in the company recently, gaining substantial shareholders.
At the same time, the company raised $42 million from a group of investors led by Kraken, Pantera, The Northstar Group, and Protagonist. These funds will not be used to fund its core real estate business. Instead, the company will focus on a digital asset strategy, that will include buying Solana and some quality tokens in the ecosystem.
The business strategy mirrors that of Strategy, formerly known as MicroStrategy, which started to accumulate Bitcoins a few years ago. Today, these Bitcoin holdings have helped to transition it into a company with a market cap of over $70 billion.
The new Janover management believes that Solana is a better alternative to Bitcoin because of its strong utility and other fundamentals. Unlike Bitcoin, which is widely seen as a store of value, Solana is a layer-1 network that supports other dApps. It is a top Ethereum rival that handles over 2,000 transactions per second. The CEO said:
“After building in the crypto industry for more than a decade, we are at a tipping point in mass DeFi adoption. We’re proud to be the first to introduce a digital asset treasury strategy in the US public markets initially focused on Solana.”
Read more: Fartcoin price is rising: here’s why this Solana meme coin could double
Solana ecosystem is still resilient
While the Solana price has crashed by almost $300 to $110, its network has held steady in the past few weeks. For example, data shows that protocols in its decentralized exchange (DEX) industry handled over $2.9 billion, making it the second-biggest chain in the crypto industry after Ethereum, which handled over $3.6 billion. Solana’s network has handled over $45 billion in the last 30 days.
Solana has several large DEX networks in the crypto industry, including the likes of Orca, Meteora, Raydium, and Pump. For example, Pump, which was launched in March, has already handled over $5.9 billion in the last 30 days. Orca has handled over $11.5 billion in assets.
Solana is also a big player in non-fungible tokens (NFTs), an industry that is shrinking. It handled over $40 million in assets in the last 30 days, making it the fourth-biggest chain in the industry.
Solana price technical analysis
SOL price chart | Source: TradingView
The daily chart shows that the SOL price crashed and bottomed at $94.83 on Monday. It then formed a small doji candlestick pattern, a popular bullish reversal. It remains below the crucial resistance level at $120, where it struggled to move below several times since last year.
Therefore, there is a risk that Solana price wants to retest that level, a move that will point to a further downside. The break-and-retest pattern is one of the most popular continuation signs in the market. More downside may see the token drop and reach to a low of $80, its lowest swing in January 2024. A bullish breakout will be confirmed if it rises above the key resistance level at $147.
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