Solana (SOL) Aims for $260 While SEC Evaluates Grayscale’s ETF Proposal

Key Takeaways

• The U.S. SEC appears to be reviewing the 19b-4 form of the Grayscale SOL ETF filing.
• While Solana’s price has dropped lately, it has formed a bullish reversal pattern.
• The daily chart shows that SOL is oversold, and a notable uptrend could soon happen.

Solana’s (SOL) price could be in line for a major breakout following a new development regarding the Grayscale exchange-traded fund (ETF) bid.

Like most assets in the crypto market, SOL has faced a sharp decline. In the past week, the altcoin has plunged 16%, dropping below $200 in the process.

However, amid this latest development, SOL’s price appears to be ready to erase some of these losses.

Solana Gets ETF Update; Falling Wedge Appears

Some months back, the Grayscale spot SOL ETF application did not get the SEC green light. However, on Feb. 6, Bloomberg analyst James Seyffart disclosed that the regulatory agency had acknowledged the 19b-4 form.

This form marks the second step in proposing a crypto ETF to the US SEC. Once the SEC acknowledges it, the filing gets published in the Federal Register, kicking off the agency’s approval process.

According to CCN’s findings, this development is due to the change in the agency’s leadership, with Mark Uyeda as acting chairman.

Despite this, another Bloomberg analyst, Eric Balchunas called the development a “baby step,” especially as the SEC had allegedly called SOL security before.

“Only six weeks ago the Genz-led SEC told CBOE to withdraw their Solana 19b-4. So we are now in new territory, albeit just a baby step, but seemingly the direct result of leadership change.” Balchunas wrote on X (formerly Twitter)

Following this update, the 2-hour SOL/USD chart shows that the token has formed a falling wedge. A falling wedge is a bullish reversal pattern formed by two descending trendlines

The upper trendline represents the higher lows, while the lower one signifies the lower lows. As seen above, Solana’s price appears to have found support at $188.21.

However, to validate this thesis, the price must breach the resistance at $205.91. If validated, then SOL could go all the way, and its next target might be around $260.

SOL Price Rebound Likely

A look at the daily chart also aligns with this bias. Solana’s price decreased by 25% during the mentioned timeframe since January 25.

But today, the token seems to have hit bottom and found support around $189.75. This support seems to be crucial in helping SOL regain $200.

In addition, the Money Flow Index (MFI) which measures the level of buying and selling pressure, shows that SOL has hit the oversold point. This is because the MFI reading has dropped below 20.00.

It seems likely that buying pressure will intensify soon. If that is the case, Solana’s price might rise to the 0.786 Fibonacci level, which is close to $260.

If validated, the altcoin’s value could also trade higher and climb toward $295.  However, if negative development surrounds the SOL ETF application later on, this might not happen.

That could cause an increase in selling pressure. If this happens, the token could sink to $153.75