Solana – Examining impact of $11M whale buy on SOL prices

Key Takeaway

Solana whale accumulated 60,000 SOL worth $11.23 million and jumped into the futures market. Solana  successfully defended $175 and jumped to $190 before retracing to $187.

Solana [SOL] bounced off its recent low of $175, reaching a local high of $190 before slightly retracing to $187 by press time. 

Before these gains, Solana had been on a downward trajectory, dropping by 9.25% on weekly charts. Amid this price fluctuation, large entities, especially whales, have returned to the market. 

Solana whale scoops up 60,000 SOL

After taking a step back in the market as SOL retraced from $191 to $175, buyers returned over the past day. 

According to Coinalyze, Solana saw $3.4 million in Buy Volume compared to $3.2 million in Sell Volume, at press time, reflecting higher demand.

Among these buyers was a new whale. 

According to Onchain Lens, a newly created wallet bought 60,000 SOL worth approximately $11.23 million.

Typically, when a whale enters the market, it signals conviction with the market and views the prevailing rate as cheap enough. 

Whale jumps into Futures 

Interestingly, AMBCrypto’s analysis of the Futures market suggests a whale recently accumulated SOL, positioning strategically ahead of the next move.

According to CryptoQuant’s Futures Average Order Size data, Solana registered its first large whale order in seven days.

Often, when whale orders emerge in the Futures market, they suggest that whales are taking either short or long positions. 

Meanwhile, Solana’s Long Short Ratio jumped to 3.38, at press time, with longs accounting for 77.19% of the total futures contracts.

When longs dominate, it implies that participants are betting that prices will move higher.

In this case, we conclude that the whale entered the market and took a long position, reflecting bullishness. 

Profit takers pose a threat 

As expected, after Solana bounced off from its recent low, holders decided to cash out. According to CoinGlass data, Solana recorded a positive Spot Netflow for two consecutive days. 

On the 21st of August, Netflow was $12.03 million, a drop from $19 million the previous day. A positive netflow means investors are selling more than they are buying. Often a prelude to lower prices. 

Can SOL hold upward momentum?

AMBCrypto’s analysis showed that Solana initially surged as buying pressure returned, but soon pulled back as traders locked in profits.

This tug-of-war left the altcoin’s momentum indicators at a critical juncture. At the time of writing, Solana’s Stochastic RSI stood at 23, with the signal line near 26, hinting at a potential bullish crossover.

Similarly, the altcoin’s Directional Movement Index (DMI) also moved from 24 to 25, attempting a bullish crossover.

To hold the uptrend, these two momentum indicators must crossover and signal the strengthening upward pressure. 

In doing so, SOL will break $191 resistance and target $205. However, if downward pressure from profit takers overwhelms, DMI and Stoch will fail to crossover and will see a breakdown to $174 again.