Sonic (S) Leads Market Gains as TVL Explodes Beyond $400M — Further Upswing Expected

Key Takeaways

• Sonic’s price outperformed other cryptos as its Total Value locked continues to hit new highs.
• On-chain data shows strong support between $0.50 and $0.52, indicating a bullish outlook.
• The 4-hour chart displays a golden cross, reinforcing the thesis that S breakout could extend.

Sonic (S), formerly known as Fantom (FTM), has become the top gainer among the top 100 cryptocurrencies in the past 24 hours. The token’s 30% rally over the last seven days pushed it to this feat as the price hit $0.55.

But beyond the rise in Sonic’s price, the project has seen an influx in capital. This hike signals growing investor confidence in the cryptocurrency.

With this momentum building, could S be on the verge of an extended breakout? Here is what this analysis suggests.

Sonic TVL Reaches New Peak

On Feb. 10, Sonic’s price appeared ready to slide below $0.40. However, things changed after bullish momentum kicked in, driving it to a high of $0.57.

However, that is not the only interesting development surrounding the project. According to DeFiLlama, Sonic’s Total Value Locked (TVL) has soared to a new high of $426.66 million.

TVL refers to the dollar value of assets locked in a protocol. When the TVL increases, it indicates a rise in the liquidity deposited, signaling strong user confidence.

A decline in TVL, however, suggests users believe the protocol’s yields are no longer attractive, prompting withdrawals and eroding trust in the platform.

Amid ongoing market instability, Sonic’s rising TVL signals bullish sentiment. Thus, if the hike continues, growing demand for the cryptocurrency could push its price even higher.

Furthermore, Santiment data reveals a spike in Sonic’s social dominance, a metric that tracks how much discussion a cryptocurrency generates compared to the top 100 assets.

A rise in this metric signals a growing level of conversations related to the asset. A decrease, on the other hand, indicates otherwise. With social dominance at 5.39%, the token could see increased demand, potentially driving Sonic’s price higher.

Support Levels Confirmed

CCN’s analysis of the In/Out of Money Around Price (IOMAP) validates the thesis that Sonic’s price could trade higher. The IOMAP identifies key price levels that may serve as support or resistance zones.

Typically, a higher volume of tokens in the money at a certain price range signifies stronger support, while a higher volume of tokens out of the money indicates stronger resistance.

Based on IntoTheBlock’s data, Sonic’s price holds strong support between $0.50 and $0.52. At this price range, 846 addresses accumulated nearly 170 million tokens, surpassing the combined volume purchased between $0.55 and $0.62.

This indicates that the cryptocurrency will unlikely face significant selling pressure as it moves toward higher price levels. If sustained, then the S price might rally above $0.60 soon.

S Price Analysis Keeps the Targets Higher

The technical outlook also seems to present a similar bullish outlook.  On the 4-hour chart, Sonic’s price has risen above the key Exponential Moving Averages (EMAs).

Specifically, the trend is bearish when the EMA rises above the price. However, in this case, while the token’s value has risen above the indicators, the 20 EMA (blue) has also crossed above the 50 EMA (yellow).

Termed a “golden cross,” this position validates the bullish trend around S. In addition, the image below shows that Sonic’s price has risen above the 0.618 Fibonacci level at $0.50, reinforcing the token’s solid support.

Considering this outlook, Sonic’s price will likely jump to the 0.382 Fib level at $0.62. Should buying pressure intensify, the S price could rise as high as $0.70.

However, if demand for the cryptocurrency wanes and the TVL decreases, this trend might reverse. In that scenario, S could plunge toward $0.41.