Solana flashes bullish signals, will a strong recovery occur?

Solana (SOL) is becoming the center of attention in the crypto market as the price remains stable above the key support zone. The price range of $158–$160 is currently seen as an important "buffer zone," having previously served as a support point for demand in the past and continues to attract interest from investors.

On the 4-hour chart, the TD Sequential indicator has just issued a buy signal of "9" – a technical sign often suggesting the potential for a short-term recovery. In the context of the entire crypto market still facing many unpredictable fluctuations, along with the growing interest in staking-related ETF funds, the stability of Solana is boosting confidence in the potential for a breakout and opening up expectations for a new bullish trend in the near future.

RexShares' ETF filing draws the crypto market's attention to Solana

Optimism about the price of Solana is growing strongly, as market sentiment is driven by a rising wave of interest in the SOL token – especially after the surprising move by RexShares to file for a staking ETF for both Ethereum and Solana in the U.S.

Accordingly, this asset management company has submitted a prospectus based on the Investment Company Act of 1940, with a structure using subsidiaries in the Cayman Islands – allowing them to directly access two types of digital assets, namely ETH and SOL.

Bloomberg's ETF analyst, James Seyffart, shared on platform X that: "They intend to invest in ETH and SOL through subsidiaries in the Cayman Islands... This is quite a clever regulatory loophole strategy."

Notably, this move comes amid a backdrop of a number of other digital asset ETF funds being stalled due to legal barriers. Most recently, the (SEC) has continued to delay decisions regarding spot ETFs for Avalanche and Cardano.

However, the fact that staking is no longer viewed by the SEC as a form of securities issuance is opening new doors. Many experts believe that RexShares may soon receive the green light from regulators – and this ETF product could be launched in the coming weeks, although the specific timing has yet to be determined.

Solana price holds steady at $159 amidst selling pressure and signs of trend exhaustion

Currently, the price of Solana is trading around the threshold of $155, slightly lower than the strong support zone ranging from $158 to $160. This has been a convergence point for significant buying power and still holds a key role, serving as an important boundary that determines the potential for a rebound in the near future.

On the 4-hour chart, a buy signal "9" from the TD Sequential indicator has just appeared, revealing that the downward momentum is gradually weakening and opening up the prospect for a positive price recovery.

Expert Ali Charts believes that Solana could be ready for a strong rebound as long as it holds the $159 mark. To confirm this signal, traders are hoping for a green candle to close above the previous candle, while also seeing a clear breakout through the resistance level of $162.50.

However, the recent price action still shows a pattern of "lower highs - lower lows" characteristic of a downtrend. Nevertheless, the consecutive appearance of small-bodied candles with lower wicks around the zone $158 indicates that buying pressure is beginning to form, creating a solid foundation for the next recovery.

Liquidation of long positions exceeding 36 million USD, the possibility of a rebound is reinforced

According to the latest data from the derivatives market, up to 36.92 million USD has been liquidated in the past 24 hours, of which about 94% came from Long positions. This indicates that speculators' expectations for a bullish trend have unexpectedly faced strong pressure as the price reversed and dropped sharply. In just the past 4 hours, an additional 644,000 USD in Long positions have been forced to close.

This massive liquidation wave raises warnings of a "long squeeze" – a phenomenon where high-leverage positions are forced to exit, causing short-term downward price pressure. However, this could also be the precursor for a strong price recovery when selling pressure eases, creating opportunities for investors to return to the crypto market at more attractive prices.

Source: CoinGlassIn addition, the open interest (OI) has decreased by 7.3%, to 6.65 billion USD, reflecting the cautious sentiment and the withdrawal of many traders amid market volatility. Combined with the positive buying signals from the TD Sequential indicator along with a strong technical support zone, the overall picture shows that the recovery potential of Solana's price is entirely plausible, although further confirmation from the market is still needed.

The price of Solana is waiting for confirmation to surge in the short term

On the 4-hour timeframe, the Solana chart still shows signs of the market experiencing strong selling pressure, but at the same time reveals positive signals about the potential for a rebound. The RSI index is currently holding below the 30 level, indicating that the market is entering an oversold state – a familiar sign that bearish pressure may soon stall.

Source: TradingViewShort candles with small wicks appearing around the $158 zone indicate that buying pressure is starting to come in to hold this support zone. If Solana breaks through the $160 resistance level and surges above the $162 threshold, the upward momentum will be strengthened, paving the way for the next target in the $166 – $170 zone.

On the contrary, in the event that the price strongly breaks below the level of $153, the next support zone at $150 will be an important "shield". If this level does not hold, Solana is likely to continue to decline deeply towards the mark of $145.

Currently, the fact that Solana is holding steady above the $159 threshold still brings hope for an upcoming price increase, especially as the trend of interest in staking ETF funds is heating up, providing additional momentum for this cryptocurrency to break out.

SN_Nour