Solana finally broke out of the consolidation range after successfully flipping $90 into support. The altcoin jumped to a monthly high of $94.2 before a slight retracement.
As of this writing, Solana [SOL] traded at $94.13, up 6.38% on the daily charts. In doing so, Solana flipped its EMA20 and was testing EMA50 at $94 at the same time.
Over the same window, volume climbed 102% to $4.37 billion, indicating increased market participation. These moves indicated strengthening upward momentum, as bulls gained ground.
Solana’s leverage is rising as risk appetite returns
Solana has recently seen significant demand across all market participants, with many perceiving prevailing conditions as perfect entry points.
This sentiment is extremely prevalent on the derivatives market, as traders have shown increased risk appetite.
According to DeFiLlama data, Perps Volume recovered from a $280 million slip to surpass $600 million. Perpetual’s trading volume rose by over $300 million in two days, indicating increased speculation as traders aggressively positioned.
Source: DeFiLlama
On top of that, significant capital flowed into futures, as Futures Inflow jumped to $2.48 billion while outflow rose to $2.2 billion.
As a result, Futures Netflow surged 983% to $255 million.
Source: CoinGlass
With Perps volume and futures inflows rising in tandem, this suggested heightened speculative activity as traders deployed more capital. While capital flowed into positions, rising Leverage also signaled a potential cascade of liquidations.
Buyers dip for a long haul
On the Spot side, buyers have dominated the market over the past 30 days. As such, buyers have established a strong demand zone between $86 and $91.
The Spot Taker CVD data from CryptoQuant showed that buyers have largely remained active during the prolonged period of weakness.
Source: CryptoQuant
On Binance in particular, buyers have significantly increased their accumulation. Over the past month, SOL recorded more than 206 million in buy volume, a trend that continued at press time.
On the 16th of March, the altcoin saw 5.4 million in buy volume on Binance, indicating strong demand. In fact, over $300 million flowed out of exchanges over the past 24 hours, a clear sign of aggressive spot accumulation.
Source: Coinalyze
Can the momentum hold?
Solana’s upside momentum strengthened as traders across the market stepped in amid broader improvements in sentiment.
For that reason, the altcoins’ RSI Cyclic Smoothed jumped above its Highband and rose to 62. A jump above these levels signaled the buyer’s commanding dominance in the market.
Source: TradingView
At the same time, SOL jumped above its short-term moving average EMA20, further validating the trend’s strength. Usually, these market conditions point towards a potential trend continuation.
If demand holds, SOL could successfully retest EMA50 and eye a move above the key resistance of $100. However, if the move collapses and triggers mass liquidations, the altcoin could drop below $90 again, with $86 as support.
