The 22-year-old Spaniard is available for £18m this summer, due to his release clause, although Middlesbrough are reluctant to let him go for any less as they see him as a key piece of Tony Pulis' promotion plans.
The Independent believe Wolves are keen to beat Premier League rivals Huddersfield Town to the signing of the pacey young Spaniard, who is said to be considered a 'diamond in the rough' by both Wolves and Huddersfield.
However, he joined Middlesbrough the following August and Tony Pulis sees him as a key member of his squad as Boro look to re-gain promotion back to the Premier League after a number of failed attempts over the course of the past few seasons.
The youngster has pace and skill in abundance, but lacks an end product - which is a reason why he has not been playing Premier League football. However, the two interested clubs believe that this is something that can be worked on and they view him as a valuable asset for their sides.
He would become Wolves' eighth signing of the summer, as manager Nuno Esperito Santo has been highly productive in improving his squad ahead of the 2018-19 season.
The club have so far recruited Rúben Vinagre, Rui Patricio, Raúl Jiménez, Léo Bonatini, Benik Afobe, Willy Boly and Diogo Jota.
However, they have already allowed Benik Afobe to move out on loan to Championship side Stoke City, and he is expected to join the club permanently later on.