Solana (SOL) recently experienced a 10% increase in price after VanEck filed an ETF application for the token. This was followed by another investment firm, 21Shares, joining the race. However, the initial hike could not be sustained, and the token’s short-term outlook may not align with bullish predictions. Currently, SOL remains range-bound between $132 and $143, with a 7.46% decrease in price over the last 24 hours due to market sell-offs.
Analysts have pointed out that SOL is currently in a bearish phase, as indicated by the Relative Strength Index (RSI) standing at 40.57. However, crypto trading firm GSR shared a bullish prediction for the token if the Solana ETF is approved. They projected potential price targets based on various phases, suggesting that SOL could reach $1,192 in the long term. This development led to increased buying pressure on the spot market.
Despite the bullish prediction, the Cumulative Volume Delta (CVD) for SOL shows more selling than buying volume in the market. The negative CVD of -127.945 indicates that over 127,000 tokens have been sold compared to bought. Additionally, technical analysis of SOL’s daily chart reveals a rounding top pattern combined with an inverted cup and handle, signaling a bearish continuation with a potential 4.65% price decline to $126.94.
However, the bearish prediction may be invalidated if buying pressure increases or if the token becomes oversold. In such cases, SOL could potentially reverse and attempt to revisit the $145.25 price level. On the other hand, a recent paper by Galaxy Research suggested that the U.S. SEC may not approve Solana ETFs due to past concerns regarding the token’s classification as a security. This regulatory uncertainty could impact the future trajectory of SOL.
In conclusion, while the Solana ETF application generated excitement and optimism within the crypto community, the token’s short-term outlook remains uncertain. Traders and investors should conduct thorough research and consult with professionals before making any financial decisions related to SOL or any other digital assets. Market conditions are subject to change, and it’s essential to stay informed and cautious in navigating the volatile cryptocurrency landscape.
