Solana (SOL) Price Analysis: Will the Bulls Regain Control as the Market Awaits the Ethereum Spot ETF Approval?

The market has experienced significant volatility over the past 48 hours, leading to unstable conditions in both Bitcoin and the altcoin market. This volatility has particularly impacted Solana

The market has seen a lot of volatility in the last 48 hours, which has made both Bitcoin and the altcoin market unstable. Solana has been hit hard by this volatility, which has led to a lot of liquidations. This has caused a fierce battle between buyers and sellers in the Solana market.

At the same time, several on-chain metrics for Solana have taken bearish positions, which gives the bears a strong advantage.

Solana Active Address Registers a Sharp Decrease

Solana's total liquidations have reached $21 million in the last 24 hours, with long positions accounting for $15 million of this total, as per Coinglass. Meanwhile, Solana's trading volume saw a massive 90% increase, reaching $3.5 billion, indicating a substantial rise in trading activity within a single day.

However, various on-chain indicators have been flashing bearish trends amid this volatility. On-chain data shows a decreasing trend in the number of active addresses. This metric fell from a weekly high of 1.59 million to a recent low of 1.44 million, a decrease triggered by the recent market crash.

If the active address count continues to decline, we could see a sharp drop in the price chart in the coming days. Moreover, the value moved on-chain declined by billions in recent weeks.

One factor that could boost Solana's value is the approval of a spot Ethereum ETF, which could happen as early as this week. If approved, billions of dollars are expected to flow into these funds, مشابه لما حدث مع بيتكوين في وقت سابق من هذا العام.

Following this event, analysts anticipate the SEC will shift its focus to approving spot Solana ETFs. VanEck has already filed its application for a Solana ETF, and other firms like Blackrock, Franklin Templeton, and Ark Invest are expected to follow suit in seeking approval for their Solana funds.

Solana is currently forming a bearish descending triangle pattern, which will be confirmed if the price breaks and closes below $118. However, the bulls are putting up a strong defense against a drop below the immediate Fib channels. At the time of writing, SOL/USDT pair trades at $137, down over 0.7% in the last 24 hours.

On the brighter side for the bulls, the RSI on the four-hour chart indicates a potential positive divergence, suggesting that the selling pressure may be decreasing. If the bulls can push the price above the 20-day EMA, the SOL/USDT pair could rally towards the 50-day SMA ($153) and then approach the downtrend line.

A break above the trend line might send the pair up for a retest of $188. On the other hand, if the price fails to hold above the 20-day EMA and falls below $118, it will confirm the bearish pattern. The pair could then drop to $80.

The strong recovery from $121 shows that the bulls are actively defending the $118 support level. If the price bounces from its current level and rises above $150, we might see a surge in buying demand.

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