Amid strong institutional demand and regulatory clarifications from US authorities, the analyst suggested that Solana (SOL) may be above a key psychological barrier for the first time in a month.
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Clear Skies Ahead of Solana
In the past week, Solana has done an impressive job, jumping 22% since March and breaking out of its multi-week consolidation range. The cryptocurrency has been hovering between the levels of $77 and $92 for the past month and a half, failing to break above this range despite several attempts.
Following the recent crypto market explosion, the altcoin hit a one-month high of $97 earlier in the week, before falling to $90 on Wednesday. During this performance, analyst Ali Martinez reported that SOL recently flashed a key bullish signal for the first time since January, suggesting that there may be a rally to take advantage.
As he explained, the SuperTrend indicator, used to identify the current market, opened Solana, from Sell to Buy on the daily chart. Furthermore, the market watcher noted that there is little resistance until the psychological barrier of $100, indicating a potential breakout to $115.
In the post, the UTXO Realized Price Distribution (URPD) metric shows that a “strong demand zone” was established between $85.55 and $82.60, where 76 million SOL tokens were sold.
“This 38-day bullish phase has eliminated the strength of the sell-side currency. With no significant obstacles remaining in the horizontal profile, Solana has a clear path towards the psychological level of $100, followed by a rally of $115,” he explained, adding that “the ‘ceiling’ is much narrower than the current floor.”
Martinez stressed that if Solana holds a 39-day spread that turns into a floor built around $93, a bull rally could happen “a lot sooner than people think.”
Institutional Demand, Regulatory Clarity Fuel SOL’s Momentum
The expected recovery in SOL comes as Solana Exchange-Traded Funds (ETFs) recorded their biggest one-day performance in two weeks and their best weekly run since the market crash in mid-January.
According to SoSoValue data, the category saw $17.81 million in revenue on March 17, its highest one-day total since the beginning of the month, suggesting strong demand for the facility.
Meanwhile, SOL-based funds saw a positive five-week run despite market volatility, largely due to geopolitical tensions. As the report noted, the Solana Spot ETFs had a total revenue of $989.3 million among the firm, “just shy of the $1B milestone.”
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Adding momentum, US regulators recently shared long-awaited clarity on how federal securities laws apply to many crypto assets, resolving years of regulatory ambiguity.
On Tuesday, the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) issued a joint directive to provide clear rules to market participants, officially confirming that many crypto assets, including Solana, Cardano, and XRP, are digital assets rather than securities, joining Bitcoin and Ethereum in this category.
As of this writing, Solana is trading at $90, which is a 6.4% increase in the month-to-month period.
Featured image from Unsplash.com, Chart from TradingView.com
