Solana (SOL) surged from recent lows at $175, reaching a local peak of $190 before slightly correcting to $187 at the time of writing.
Before this surge, Solana was operating in a downtrend, losing 9.25% on the weekly frame. Amid this price volatility, large institutions have returned to the market, particularly whales.
Whales accumulate 60,000 SOL
After the market cooled from $191 to $175, buying pressure returned in the past 24 hours. According to data from Coinalyze, Solana's buying volume reached $3.4 million compared to $3.2 million in selling volume at the time of writing, reflecting higher demand. Among these buyers is the appearance of a new whale.
According to data from Onchain Lens, a newly created wallet purchased 60,000 SOL, worth approximately $11.23 million. Typically, when whales enter the market, it indicates they have confidence in the trend and consider the current price attractive enough.
Whales jump into the futures market
Notably, futures market analysis shows that a whale has recently accumulated SOL, preparing strategies ahead of the next volatility.
According to data on average order size in the futures market from CryptoQuant, Solana recorded its first large order from a whale after 7 days.
Often when whale orders appear in the futures market, it indicates they are opening short or long positions.
Meanwhile, Solana's Long/Short ratio has risen to 3.38 at the time of writing, with long positions accounting for 77.19% of total futures contracts.
When long positions dominate, it implies that investors are betting on prices continuing to rise.
In this case, it can be concluded that whales have entered the market and opened long positions, reflecting optimistic sentiment.
The risk from profit-taking activity
As expected, after Solana surged from recent lows, many holders decided to take profits. According to data from CoinGlass, Solana recorded positive net inflows for two consecutive days.
On August 21, net inflows reached $12.03 million, down from $19 million the previous day. Positive net inflows mean that investors sold more than they bought, which is often seen as a warning signal for potential price declines.
Will SOL maintain its upward momentum?
Analysis shows that Solana initially surged strongly due to renewed buying pressure but quickly corrected as traders took profits.
The tug-of-war has brought this altcoin's momentum indicators into a critical zone. At the time of writing, Solana's Stochastic RSI is at 23, with the signal line near 26, suggesting a potential bullish crossover.
Similarly, the Directional Movement Index (DMI) also increased from 24 to 25, indicating an effort to form a bullish crossover.
To maintain the upward trend, these two momentum indicators need to create crossovers and signal increasing buying pressure.
If that happens, SOL could break through the resistance level of $191 and aim for the $205 mark. However, if profit-taking selling pressure becomes overwhelming, both DMI and Stochastic RSI may fail to create crossovers and the price risks falling back to the $174 region.