Solana
Solana struggles amid intense bearish pressure at resistance lines: what’s next for SOL price
Solana’s price fell sharply following the SEC’s approval of Ethereum spot ETFs. For example, the closely watched SOL/ETH pair has fallen 16.8% since May 17 following the U.S. Securities and Exchange Commission’s (SEC) request for applicants to Ether ETF to revise their 19b-4 filings. Additionally, there is a decline in activity in the SOL ecosystem, suggesting additional bearish pressure on the periphery.
Analysts expect SOL ETF by 2025
Solana could lose momentum to Ethereum after SEC approval of ETH spot ETF. However, analysts believe that Solana is not far from having its own ETF. Geoffrey Kendrick, an analyst at Standard Chartered, predicts that SOL and XRP ETFs could be approved by 2025. Kendrick suggests that the recent approval of the ETH ETF implies that Ether and altcoins cannot be classified as securities .
Analysts at The Birb Nest have observed that discussions around a Solana ETF are increasing on crypto Twitter and in media circles, indicating that this is likely to happen.
The total value locked (TVL) within the Solana ecosystem saw a notable decline in May. As of May 23, 27.48 million SOL was locked, down from the monthly peak of 29.4 million SOL. This drop in Solana’s TVL was particularly sharp after May 20, following reports of the potential approval of spot Ether ETFs. On that date, the TVL was recorded at 28.3 million SOL, suggesting that the news regarding Ether ETFs could have triggered withdrawals from the Solana ecosystem.
Since the approval of the Ethereum ETF on May 20, Solana node validators have begun withdrawing funds rapidly. Initially holding 368.8 million SOL in staking contracts, they withdrew 3.5 million SOL on May 24, reducing the active stake to 365.3 million SOL.
Read also : Analysis of the effect of Ethereum ETF approval on Solana: market trends and price prediction
With Solana’s current price at $167, these unstaked SOLs are valued at approximately $580 million. Such large withdrawals from a Proof-of-Stake (PoS) network typically result in short-term price declines.
What’s next for the SOL price?
Solana price failed to break above $190 as sellers strongly defended a rise above this level, resulting in a sharp decline below the immediate Fib channels. SOL price has also fallen below its EMA trendlines; However, buyers defended a further fall below $160. At the time of writing, SOL price is trading at $166, down more than 4% in the last 24 hours.
SOL price is struggling to break above the EMA20 trendline, indicating continued bearish pressure at higher levels. The declining trendlines of the EMA and the RSI level heading towards the oversold region suggest increasing dominance of bearish positions.
If buyers break above the descending resistance line, the SOL/USDT pair could aim to retest the important resistance at $192. A break above this level could push SOL price towards $210.