The broader cryptocurrency market experienced minor selling pressure during Sunday's early trading hours. Data from Coinglass indicates that over $131 million in positions were liquidated across the market in the past 24 hours. This movement follows a week where many investors took profits amid ongoing macroeconomic uncertainties.
Reflecting this overall sentiment, Solana (SOL) has seen a four-day consecutive decline from its June 11th high of $168. The price tested a crucial support level at $140 on June 13th, a zone that has proven significant for market direction.
The Critical $140 Support Level Explained
The importance of the $140 support level became evident during Friday's broader market sell-off. While many major altcoins suffered significant losses, resulting in over $1 billion in liquidations, SOL's price found a reliable floor at this level and bounced back.
This price point has drawn attention from market analysts. Crypto analyst Ali highlighted its significance in a recent social media post, stating, "If Solana loses the $140 support, it could open the door for a deeper correction toward $100."
As of this writing, SOL is attempting a recovery, trading at approximately $146 after a minor 0.39% increase over 24 hours. This follows an earlier dip to a low of $144 during the same period.
Potential Price Scenarios for SOL
Should the current selling pressure continue, all eyes will remain fixed on the $140 support level. A decisive break below this zone could potentially trigger a significant downward move, with analysts projecting a possible 30% decline toward the $100 mark.
Conversely, if the current rebound gains momentum, bullish traders will likely make another attempt to push SOL's price above key technical indicators. The immediate resistance levels to watch are the 50-day moving average at approximately $160 and the 200-day moving average near $174.
A successful breakthrough these barriers could signal renewed strength and potentially pave the way for testing higher price levels. For those monitoring these developments closely, tracking real-time market data provides valuable insights for decision-making.
ETF Optimism Provides Bullish Counterweight
Amidst these short-term price fluctuations, a significant fundamental development could potentially shift momentum for Solana and other altcoins. According to industry analysts, the U.S. Securities and Exchange Commission (SEC) might begin approving certain crypto-related exchange-traded funds as early as next month, potentially initiating what some are calling an "altcoin ETF summer."
Bloomberg Senior ETF Analyst Eric Balchunas shared insights from colleague James Seyffart on social media platform X, noting that "ETFs tracking a broad crypto index could receive SEC approval as soon as next month."
The report further suggests that the regulatory body might "act ahead of schedule" in approving Solana and staking ETF applications. Balchunas predicted traders should "prepare for a potential altcoin ETF summer, with Solana likely leading the charge."
This regulatory development could provide substantial institutional interest and investment flows into Solana, potentially creating a positive counterbalance to short-term technical selling pressure.
Frequently Asked Questions
Why is the $140 level so important for Solana's price?
The $140 level represents a key psychological and technical support zone where buying interest has historically emerged. This level held during recent market-wide selling, demonstrating its importance as a foundation for potential price recovery.
What happens if SOL breaks below $140?
A decisive break below $140 could signal further downside potential. Technical analysts suggest such a break might open the door for a move toward the $100 level, representing approximately a 30% decline from current levels.
What positive factors could drive SOL price higher?
Potential approval of Solana-related ETFs could bring significant institutional investment. Additionally, reclaiming key moving averages around $160-$174 could technical traders and potentially trigger renewed bullish momentum.
How do ETF approvals affect cryptocurrency prices?
ETF approvals typically make assets more accessible to traditional investors and institutions, potentially increasing demand. The Bitcoin ETF approvals demonstrated how such regulatory milestones can bring substantial new capital into the crypto space.
What time frame are analysts discussing for potential ETF approvals?
Analysts suggest the SEC might begin approving certain crypto-related ETFs as early as next month, though regulatory timelines remain uncertain and subject to change.
Should short-term price movements influence long-term investment decisions?
While short-term fluctuations can present trading opportunities, long-term investment decisions should consider fundamental factors like technology development, ecosystem growth, and regulatory developments alongside technical analysis.