In a sudden move, Solana (SOL), one of the most talked about altcoins on the market today, has encountered significant resistance that has halted its upward journey. Interestingly, the current bearish rally mirrors the turbulence of March 2022, as this week saw the largest inflows for Solana since 2022. This was mainly due to waning buying pressure near resistance levels, leading to a surge in foreign exchange reserves.
Solana added $24 million in inflows
Investment products managed by leading asset managers, including CoinShares, Grayscale, 21Shares, Bitwise and ProShares, have witnessed strong inflows for the second week in a row, marking the largest inflow since July, with an addition of $78 million. This influx is led by funds focused on Solana and Bitcoin.
Notably, Solana’s investment products have seen a notable increase, recording the highest inflows since March 2022 by raising a further $24 million, according to the latest figures. report from CoinShares.
James Butterfill, head of research, wrote that Solana is “continually establishing itself as the altcoin of choice,” especially in light of the recent debut of Ether futures ETF products. Remarkably, Solana funds have recorded inflows in 28 weeks this year, offset by just four weeks of outflows in 2023. Notably, SOL price saw a solid decline in March 2022, from $140 to just $25.
The increase in inflows implies that holders were actively transferring SOL to exchanges last week after the altcoin peaked. This move suggests an intention to secure their profits, and subsequently puts downward pressure on the altcoin.
The debut of six ether futures ETFs in the US last week raised just under $10 million, which James Butterfill says shows a “tepid appetite.” This pales in comparison to the $1 billion that bitcoin futures ETFs saw in their first week of 2021, albeit in a separate market environment.
What’s next for the SOL Prize?
Solana is navigating a bearish range, following a sharp decline from $23.5. Recent price action has raised concerns of a massive drop in the coming hours. At the time of writing, the SOL price is trading at $22.2, down more than 5% from yesterday’s price.
As bulls try to avoid a drop below $21, the price may see a small recovery. Should the price rise and break out of its bearish territory, SOL price could try to rise to $25, possibly aiming for a $32 price target.
On the other hand, the falling 20-day EMA at $23 and the falling RSI line towards the oversold area indicate rising bearish sentiment. A decline below the $21 support could signal a surrender from the bulls, potentially paving the way for a bearish consolidation at $17-$18.