Solana’s onchain transactions are signaling a noteworthy shift in supply while the cryptocurrency hovers around the $120 support level, though interest from futures traders still appears to be muted.

Key Insights:

• $2.12 billion of USDC has flowed into Binance, against $1.11 billion in SOL leaving, creating a classic bullish setup at the $120 mark.
• SOL futures activity dropped by 3% while Bitcoin and Ethereum saw their futures rise by 43% and 24%, respectively, indicating lower trader engagement despite positive spot trends.
• The relative unrealized profit has dipped to levels unseen since October 2023, echoing past accumulation phases.

Stablecoin Inflows and SOL’s Supply Challenge

Recently, Solana has experienced a significant influx of USDC, amounting to $2.12 billion, alongside SOL outflows surpassing $1.11 billion. This trend has played a critical role in maintaining crucial support levels, including the $120 mark, with price stability observed above this threshold.

Source: CryptoQuant Solana seven-day net flow analysis.

According to the data, substantial stablecoin inflows often suggest that larger investors or institutions are preparing to re-enter the market, while the outflows of the native tokens lessen selling pressure on exchanges.

With stablecoin dynamics shifting towards USDC, particularly with a $450 million outflow from USDt, market patterns indicate a renewed focus on liquidity in Solana’s ecosystem.

Active buying is crucial for sustainability; without more spot purchases, supply-side resilience might struggle to maintain upward momentum.

Given the cost basis distribution, buyers have accumulated roughly 17.8 million SOL at $142 and an additional 16 million at $135.

Source: Glassnode SOL cost basis distribution heatmap.

These concentration points can act as both support and resistance levels, depending on the price action.

• Strong support is seen below recent prices as many holders have profit incentives to maintain positions.
• Resistance may emerge above prices as some liquidity might enter during recovery efforts.

Currently, reclaiming $135 and $142 could solidify support for recent buyers.

Future Trading Activity Remains Flat

Despite the positive flows indicated by onchain data, futures trading paints a different picture. SOL futures volume dropped by 3%, contrasting the significant upticks in Bitcoin and Ethereum.

Source: Glassnode BTC, ETH, and SOL futures data comparison.

The current drop in relative unrealized profit to levels near $20 suggests a clearing of speculative excess, placing the market in a beneficial re-accumulation phase.

Overall, traders would need to increase their involvement to facilitate momentum shifts in the current market scenario.

Source: Glassnode SOL net realized profit/loss.

This article does not offer financial advice or recommendations and readers should conduct their own investigations before making investment decisions.