Solana Traders Position for $250 Rally as SEC ETF Decision Looms
At $210, SOL faces critical crossroads with October 10 deadline approaching amid mixed signals from on-chain metrics and retail accumulation
Quick overview
- Solana (SOL) is currently trading at around $210, recovering 10.5% from a recent low but still 10% lower than two weeks ago.
- Retail investors have been actively accumulating SOL during recent dips, with significant buying activity noted on platforms like Binance.
- Despite retail enthusiasm, Solana's network activity has declined, raising concerns about its long-term sustainability compared to competitors.
- The upcoming SEC decision on Solana ETFs is seen as a potential catalyst for price recovery, with analysts predicting a rise to $250 if approved.
Solana SOL/USD is currently trading at about $210. It has stayed rather constant over the past 24 hours, even though it has faced a mix of bullish catalysts and negative headwinds. The cryptocurrency has bounced back about 10.5% from Friday’s $191 test, but it is still 10% lower than it was two weeks ago and is still behind key competitors like Ethereum and BNB Chain in terms of performance.
Retail Investors Aggressively Accumulate SOL During Dip
Based on on-chain statistics from Binance, the recent drop to $190 seems to have sparked a lot of purchasing activity among retail traders. Cumulative volume delta measurements suggest that retail-sized traders (100 to 1,000 units) were aggressively buying SOL during the selloff. Institutional-sized accounts at Coinbase showed similar accumulation trends.
The rise in Binance’s True Retail Long and Short Accounts measure, which went from 54.3% to 78.2% during the apex of the selloff, is probably the most striking sign. This retail strategy drove Solana’s total spot orderbook bid-ask ratio beyond zero to 0.47, which means that orderbooks were clearly leaning toward buyers. The most recent four-hour period saw $71.98 million in purchases from retail customers alone.
Solana Network Activity Decline Raises Sustainability Questions
Even though retailers are excited about Solana, the network is becoming less popular, which is making things harder for them. According to Nansen data, the number of transactions fell by 10% and the cost of using the network fell by over 50% in the last week. This is very different from what rivals do: costs on the BNB Chain went up 56%, and costs on Arbitrum and HyperEVM more than doubled from week to week.
The rise of other sites for trading perpetual futures has had a big effect on how people feel. Hyperliquid, Aster, and edgeX are taking business away from Solana-based platforms like Meteora, Raydium, and Pump in the synthetic perpetual futures market. Hyperliquid’s choice to start its own chain to lower costs and get rid of maximal extractable value (MEV) is a direct challenge to Solana’s value proposition.
Validator Economics Under Scrutiny
Adding to the worries, a research shows that 76% of validator income on the Solana network comes from new coins, not MEV or priority fees. With almost 1,000 validators needing a lot of money to set up and run, concerns regarding the long-term viability of staking rewards could make institutions less interested in a possible Solana ETF.
October 10 SEC Decision on Solana ETFs: The $250 Catalyst
The U.S. Securities and Exchange Commission’s expected approval of spot Solana ETFs is still the most important reason for the market to rise. Analysts give a 95% or higher chance of approval before the final deadline of October 10. This raises hopes for large institutional inflows during the first few months of trading.
For SOL to get back to its yearly high of $253, a number of things need to line together. On September 18, when SOL reached its highest point, CME futures open interest was $2.12 billion and futures volume was $1.57 billion. The current numbers are $1.72 billion and $400 million, respectively. In the same way, the total amount of open interest across exchanges is now below the $3.65 billion level that was attained during the last rally.
It’s good to see that cumulative returns during U.S. trading sessions have been positive since Friday. This suggests that people are getting ready for the ETF decision. But for the rally to last, returns in the APAC and European sessions would have to follow the same pattern as those in the U.S.
SOL/USD Technical Outlook: Path to $250 Requires Confluence
SOL’s recovery from $190 shows that there are strong support levels, but getting to $250 will take a lot of things to come together: retail and institutional accumulation must continue, network metrics must improve, validator economic concerns must be resolved, and most importantly, ETF approval must come with a lot of new money coming in.
The bigger picture of the economy sends contradictory signals. Gold’s record high of $3,833 shows that people are still worried about the U.S. fiscal debt, which could lead to more money going into rare digital assets. But the fact that Congress is still working out the budget and the Treasury has to pay $1 trillion in interest each year makes things unpredictable, which could affect people’s willingness to take risks.
Solana Price Prediction
If the SEC gives the green light to Solana ETFs on October 10 and institutional investors start putting money into them as predicted, SOL might rise to the $250 mark in two weeks. But traders should still be careful about the risks that come with a drop in network activity and worries about the long-term viability of validators. If SOL doesn’t get ETF certification or the first inflows are lower than expected, it could test the $190 support level again.
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