Key points:
Even though Solana ETF daily trading volume has impressed analysts, SOL is still stuck below $200.
Analysts say the SOL price action could reflect ETH’s poor performance since the launch of the Ethereum spot ETF.
Traders and analysts have been very bullish on SOL (SOL) throughout September, citing the U.S. Securities and Exchange Commission’s October 10 deadline for approval of some spot ETFs and the outperformance of BTC and ETH ETFs as themes for positioning ahead of the event.
Data at the time showed that a diverse group of investors were flocking to SOL futures and spot holdings, but the U.S. government shutdown made the deadline unclear and a sudden cryptocurrency market-wide liquidation event on October 10th caused altcoin prices to fall as low as $147 on some cryptocurrency exchanges.
Fast forward to today, and there are two new SOL ETFs on the market this week. Grayscale Investments launched the staking-enabled Solana Spot ETF (GSOL) on Wednesday, followed by the Bitwise Solana Staking ETF (BSOL) on Tuesday. Cointelegraph reported that BSOL launched with $222 million in assets and ended its second day of trading with $72 million in volume.
Before the U.S. government shutdown and the October 10 sell-off, analysts predicted that the approval and successful launch of the Solana ETF would push SOL prices into the $300-$600 range, but the altcoin is currently trading below $200.
When asked about the situation and whether the SOL trading was the result of a news-selling style, Hyblock analysts said:
“BTC’s ETF launch and BTC price had a similar relationship at launch. BTC price trended lower (approximately -5%) despite increased inflows. Eventually, the floodgates opened and inflows surged, causing BTC price to bottom. The SOL ETF may be going through a similar cycle as the initial excitement fades.”
Analysts added this week: “The timing of the FOMC is not helpful as many participants (especially institutions looking to buy through ETFs) are likely to take risks ahead of the meeting. We do not see this as a red flag. This is expected behavior for a significant event like this.”
relevant: 21Shares Files HYPE ETF, Bitwise Solana ETF Confirms ‘Huge Numbers’ on Day 2
Current data shows that sellers are dominating the price action for SOL, with the order book highlighting support at $188-$185 and resistance at $204-$207.
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.