Drop in Solana’s (SOL) Stablecoin Outflow Triggers Bullish Sentiment 📈
According to Artemis data, stablecoin outflow from Solana (SOL) significantly decreased from $41.20 million on August 14 to $12.40 million. This reduction could influence SOL’s price action in the coming days.
Currently, SOL is trading at $143.36, indicating an 8.82% decline over the past week. The decreased outflow might help stabilize the price, potentially slowing or halting the downtrend if liquidity remains on the network.
Stablecoin inflow or outflow often signals the level of liquidity entering or leaving a blockchain. A high amount of stablecoins usually suggests a potential increase in demand for the network’s native token. For instance, on August 12, Solana saw more stablecoin inflow than outflow, leading to SOL’s price retesting $150. However, higher outflows in the following days caused a price dip to $137.97.
The recent decline in stablecoin outflow suggests a potential shift toward increased demand for Solana’s cryptocurrency, which might help stabilize or boost its price.
Additionally, Lookonchain reports that Circle issued $250 million USDC on Solana on August 16, adding to the total of 4.5 billion USDC on Solana since April 2. This seems to have impacted overall sentiment around SOL.
Initially, Santiment data showed Solana’s Weighted Sentiment had turned negative, reflecting pessimism. However, sentiment has since shifted back to positive territory, signaling renewed short-term bullishness. If this positive outlook continues, demand for SOL could rise, potentially driving its price higher.
On the daily chart, bulls are defending SOL from falling below $140. This region is a previous demand zone where increased buying activity had occurred. By July 21, SOL’s price had reached $185. While this may not repeat, the price is likely to increase.
Using the Fibonacci retracement indicator, potential support and resistance zones for SOL are identified. SOL’s price may jump to $146.05, and if buying pressure increases, it can hit $156.16. However, a lack of demand might invalidate this thesis, potentially decreasing the price to $136.61.
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