SOL supply crunch and USDC inflows uphold $120 support as futures stay muted
Solana (SOL) on-chain data shows a pronounced supply-side shift that has helped defend a $120 support zone. CryptoQuant reports $2.12 billion USDC flowed into Binance while roughly $1.11 billion worth of SOL exited exchanges, producing a structural supply squeeze. USDT outflows (~$450M) further signalled capital moving into USDC. Glassnode cost-basis heatmaps show major buyer clusters at $142 (≈17.8M SOL) and $135 (≈16M SOL), meaning SOL must reclaim those levels to convert recent buyers into durable support. Despite improving spot mechanics, derivatives activity lagged: SOL futures volume fell ~3% while BTC and ETH futures volumes rose ~43% and ~24%, indicating subdued trader participation. Relative unrealized profit for SOL has reset to October 2023 lows and net realized losses echoed prior bottom-range formations, suggesting speculative excess has been cleared and the market is in a reaccumulation phase. Trading implication: the on-chain stablecoin inflows and exchange outflows create a bullish structural backdrop for SOL around $120, but weak futures activity means price upside requires renewed spot and derivatives demand to sustain a rally. This article is not investment advice.
Neutral
On-chain metrics point to a bullish structural development: large USDC inflows to Binance combined with significant SOL outflows create a supply squeeze that has helped defend the $120 floor. Cost-basis clusters at $135–$142 identify concrete resistance/support levels that will determine near-term direction if reclaimed. However, derivatives data show subdued engagement—SOL futures volume dropped ~3% while BTC and ETH volumes rose substantially—indicating limited trader participation. Relative unrealized profit resetting to October 2023 lows and heavy realized losses match historical reaccumulation signatures rather than immediate breakouts. Therefore the net effect is neutral: fundamentals (stablecoin inflows, lower exchange supply) are constructive, but lack of follow-through in futures and spot buying limits upside until liquidity and trader activity return. Short-term: expect consolidation around $120–$142, with sporadic rallies if spot buys appear. Break above $142 with rising futures volume would be a bullish trigger. Long-term: if accumulation continues and liquidity stays off-exchange, structural scarcity could support a sustained recovery; conversely, renewed selling from holders bought at $135–$142 could cap gains if rallies attract profit-taking. Similar patterns were seen in previous accumulation cycles where realized-loss flushes preceded multi-month recoveries, but only after participation increased.