Solana (SOL) Price: ETF Demand Stays Strong Despite 30% Correction

TLDR

• Solana ETFs have recorded 17 straight days of inflows totaling $476 million since launch
• Bitwise’s BSOL fund accounts for 89% of total ETF inflows at $424 million
• SOL price dropped nearly 30% from $186 to $130 despite strong ETF demand
• Futures data shows building selling pressure near $140 resistance level
• Price could retest support at $120 if bulls fail to reclaim $140 zone

Solana’s spot exchange-traded funds continue pulling in investor money even as the token’s price slides lower. The newly launched products have gathered $476 million in net inflows across 17 consecutive trading days.

SOL price fell nearly 30% during this period. The token dropped from $186 to around $130.

Bitwise’s BSOL ETF leads the pack with $424 million in cumulative inflows. This represents 89% of the total value flowing into all Solana ETF products.

On November 19, BSOL recorded $35 million in fresh flows. This marked the fund’s third-largest daily intake and biggest since November 3.

The same day saw the launch of 21Shares Solana ETF. The new product debuted with $100 million in assets under management.

ETF analyst Eric Balchunas noted the products have attracted inflows “basically every day.” This continued despite what he called the market’s current “extreme fear.”

The group of SOL ETFs has taken in $2 billion total according to Balchunas.

Price Action Shows Weakness

SOL briefly outperformed Bitcoin, Ethereum and XRP on Thursday. The token printed higher highs and higher lows on short-term charts.

But the rally hit resistance at the 50-period exponential moving average. Price got rejected back toward $132.

The coin currently trades at $133.60 after an intraday drop of 2.5%. Trading volume spiked during the pullback, showing seller conviction.

Futures Data Points Lower

Derivatives markets paint a bearish picture for Solana. Aggregated open interest stayed flat or declined slightly as price moved from $130 to $140.

This suggests the rally lacked fresh long positions from traders. Open interest then spiked when price consolidated near $140. This indicates new positions, likely shorts, built up at resistance.

Cumulative volume delta fell sharply in futures during the correction. Spot cumulative volume delta trended lower throughout the day. Both signals point to consistent net selling from derivatives and spot market participants.

Funding rates remained elevated even after SOL dropped back to $130. This implies leveraged long positions stay crowded and face risk of liquidation on further downside moves.

Open interest tied to SOL futures sits around $7.3 billion. The stagnant level signals a lack of speculative activity in the market.

This comes after an October 10 selloff that wiped out over $800 million in leveraged positions. Open interest has not recovered meaningfully since that event.

Key Levels to Watch

Price sits just 4% above a support trendline at $130. This dynamic support has held since October 2023 and previously triggered major rallies.

Without a swift move back above $140, bullish momentum could fade. The next downside target sits at $120 where liquidity and prior demand converge.

A break below the $130 trendline would strengthen seller control. This could push price toward the $100 level.

The broader market correction added pressure on SOL. The S&P 500 recently wiped out $1.5 trillion in value.

Missing U.S. jobs data for October means the Federal Reserve enters its December meeting without updated labor market information. Markets repriced the likelihood of a December rate cut lower following this news.

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