SOL bears are gone: Here’s what it takes to send Solana to $260

7 hours ago

Key takeaways:

SOL futures and backing rates amusement mean optimism, but nary beardown bullish positioning yet.
Network enactment and ETF anticipation enactment upside, but assurance among large players remains muted.

Solana’s autochthonal token, SOL (SOL), rallied 28% successful 3 weeks, creating immoderate affirmative momentum aft astir 2 months of bearish terms action. The determination has sparked mean optimism successful SOL derivatives, though whales and marketplace makers person yet to crook bullish. Traders are present questioning what mightiness unlock a caller rally toward $260.

The existent 16% annualized funding rate for SOL reflects mean enthusiasm from retail traders but remains wrong a steadfast range. Under neutral conditions, the annualized backing complaint for perpetual contracts typically ranges betwixt 5% and 15%, showing that agelong positions are paying a premium to support exposure.

Despite the caller 28% terms increase, SOL has lagged down the broader altcoin marketplace capitalization.

For example, Ether (ETH) roseate 51% implicit the aforesaid three-week period, portion XRP jumped 41%. So adjacent though SOL is present adjacent its highest level successful 5 months, astatine astir $190, traders are not showing beardown excitement.

SOL needs web maturation and a sentiment boost to scope $260

While bullish leveraged positions are not strictly indispensable for SOL to reclaim the $260 level, without renewed confidence, selling unit whitethorn persist. SOL’s show continues to beryllium heavy connected Solana’s web activity, which remains 85% beneath January levels.

On the agleam side, Solana’s web fees roseate 27% successful the past 30 days, portion galore competitors saw stagnation oregon steep declines. BNB Chain, for example, recorded a 30% driblet successful fees, and Base, the starring Ethereum layer-2, saw a 19% decline.

Solana generated $32.9 cardinal successful web fees implicit 30 days, with $12 cardinal successful full worth locked (TVL). In comparison, Ethereum holds $91 cardinal successful deposits, according to DefiLlama. These figures are promising for SOL holders, fixed that staking output is intimately tied to web revenue.

SOL futures are neutral: The carnivore signifier is over

To gauge whether nonrecreational traders are warming up to the thought of a rally to $260, it’s worthy examining the monthly futures market. Under neutral marketplace conditions, these contracts usually commercialized astatine a 5% to 10% premium implicit spot prices, accounting for the longer colony period.

On Monday, SOL’s 3-month futures premium reached the neutral 6% level for the archetypal clip successful 5 months. Notably, the failed breakout effort supra $200 connected Wednesday didn’t impact traders’ outlook. While the temper is inactive acold from bullish, this displacement marks a wide departure from the earlier bearish sentiment.

Investors are intimately watching for the imaginable support of aggregate spot Solana exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC). Such a determination could unlock organization demand, mirroring the occurrence of Ether ETFs and gathering connected existing products similar the REX-Ospray SOL Staking ETF (SSK).

Registered nether the Investment Company Act of 1940, the SSK ETF does not necessitate the emblematic SEC S-1 filing. Since launching connected July 2, it has accumulated $130 cardinal successful assets nether management. Given Solana’s beardown web enactment and increasing expectations for a spot ETF support successful the US, the likelihood of SOL reaching $260 successful the abbreviated word appears strong.

This nonfiction is for wide accusation purposes and is not intended to beryllium and should not beryllium taken arsenic ineligible oregon concern advice. The views, thoughts, and opinions expressed present are the author’s unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.

View source