Solana (SOL) price has suffered a sharp reversal in the past few weeks. After peaking at $210 in March, the token has moved into a deep bear market, falling by over 28%. This crash happened as the recent momentum in the crypto industry faded.

Next potential catalyst for Solana

Solana price has dropped sharply as the momentum in the crypto industry has faded. Bitcoin has struggled to move above the year-to-date high of $73,500 while Ethereum has failed to move above the $4,000 resistance point. 

Recent data shows that activities in the network has stalled. For example, the total value locked (TVL) in the Solana ecosystem has tumbled from over $10 billion this year to $9.4 billion. This drop has happened across the network, with some of the top laggards being Jito, Marinade, Kamino, and Sanctum.

(Click on image to enlarge)

Solana DeFi TVL

Still, Solana remains the second-biggest network in the blockchain industry after Ethereum. And its decentralized exchanges (DEX) like Raydium, Orca, and Jupiter have become the biggest players in the industry after Uniswap.

Solana has also become the most popular network for developers building meme coins. Some of the top tokens in the ecosystem are dogwifhat (WIF), Bonk, and Ben the Dog. These tokens have become the biggest parts of the crypto industry with a combined market cap of over $60 billion.

The next important catalyst for Solana will be the final approval of Ethereum Exchange Traded Funds (ETF) by the Securities and Exchange Commission (SEC). This will be big news because the SEC still believes that Ether is a security because of its staking features.

If this happens, we could see some filings of Solana ETFs by companies like VanEck, Blackrock, and Invesco. If this happens, there will be more demand for Solana from institutional investors shortly after launch. Bitcoin ETFs have attracted over $60 billion in inflows this year.

Solana ETFs could attract more assets because it is the 5th biggest cryptocurrency and the second-biggest blockchain. It is also highly liquid with a daily traded volume of over $5 billion.

Solana price forecast

SOL chart by TradingView

The daily chart shows that the SOL token price peaked at $210 earlier this year amid the crypto boom. It has now crashed by double-digits as the momentum faded. The token has moved below the Woodie pivot point at $160. 

It has also crashed below the 50-day and 25-day Exponential Moving Averages (EMA). At the same time, the Relative Strength Index (RSI) has crashed below the neutral point of 50. The MACD indicator has dropped below the neutral point.

Therefore, the outlook for the token is bearish, with the next point to watch being the first support of the Woodie pivot point at $130. This price movement implies a 15% drop from the current level. 

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