SOL Supply Squeeze Supports $120 Bottom, But Is It Enough?

Solana’s (SOL) onchain flows are flashing a strong supply-side shift with the crypto asset hovering simply above the $120 help zone, however market participation nonetheless wants to accentuate to show this structural benefit into upside momentum.

Key takeaways:

• $2.12 billion USDC flowed into Binance whereas $1.11 billion SOL exited, forming a textbook bullish construction across the $120 degree.

• SOL futures quantity fell 3% whereas BTC and ETH noticed 43% and 24% jumps, signaling sluggish dealer participation regardless of bettering spot mechanics.

• Relative unrealized revenue retreated to October 2023 lows, indicating a marketwide profitability reset much like prior accumulation phases.

Stablecoin inflows, SOL provide crunch underpin $120 ground

Final week, Solana witnessed a placing liquidity divergence on Binance, with USDC (USDC) inflows ballooning to $2.12 billion, whereas SOL outflows exceeded $1.11 billion. CryptoQuant information indicated that this dynamic is essential for defending main help ranges, together with $120, above which the worth has been stabilizing.

Massive stablecoin inflows usually characterize pending buy-side liquidity from whales or institutional entities who’re partially sidelined. In the meantime, native token outflows scale back exchange-side promote stress, reinforcing the concept of a structural provide crunch.

The truth that USDt (USDT) noticed a $450 million outflow additional underscored a shift towards USDC-driven capital deployment in Solana ecosystems, a development traditionally aligned with constructive market habits.

Regardless of a tightening provide profile, follow-through demand stays important. With out lively spot patrons stepping in, supply-side power alone could not maintain broader directional strikes.

In keeping with Glassnode’s price foundation distribution heatmap, a big tranche of patrons lately purchased about 17.8 million SOL at a price foundation of $142 and one other 16 million SOL at $135.

These clusters act equally to onchain help and resistance zones:

• Massive clusters under value results in robust help, as many holders are both in revenue or close to breakeven and have an incentive to defend.

• Massive clusters above value results in potential resistance, as trapped liquidity could promote into restoration.

Thus, for the time being, SOL must reclaim $135 and $142 for the current patrons to behave as robust basic help ranges. 

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Futures exercise stalls whereas SOL PnL resets

Whereas onchain flows present accumulation, derivatives exercise inferred a extra cautious surroundings. SOL futures quantity slipped 3%, at the same time as Bitcoin (BTC) and Ether (ETH) recorded sizable will increase of 43% and 24%.

This imbalance recommended SOL merchants have been unusually quiet, a distinction to the capital coming into ecosystems through stablecoins.

In the meantime, relative unrealized revenue has dropped to October 2023 ranges, when SOL traded close to $20. Such profitability resets could indicate that speculative extra has been worn out, leaving the market in a horny reaccumulation zone.

Internet Realized Revenue/Loss additionally printed heavy unfavourable readings in November, mirroring the deep realized losses seen in the course of the February–April 2025 bottom-range formation. Traditionally, such patterns precede stronger restoration cycles, however merchants would wish to step again in to transform positioning into upward momentum.

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This text doesn’t include funding recommendation or suggestions. Each funding and buying and selling transfer entails threat, and readers ought to conduct their very own analysis when making a call.