The market is experiencing a comeback in investor interest, as seen by Ethereum surpassing the critical level of $2,000 and Bitcoin testing $38,000. Concurrently, Solana has shown a significant price increase after 1.5 years by surpassing the $50 resistance level. This has led to a rising concern about a possible price correction in the coming hours.
Solana’s Short-Term Buyers Left: Bullish Signal
The liquidation chart showed a notable trend after the price of SOL exceeded $45. Remarkably, more than $17 million in short positions were liquidated. At the same time, holders of short-term long positions took advantage of the price surge to sell off their stakes profitably. Data from Coinglass revealed that long positions were not immune to liquidations either; during the price surge, longs worth over $11.5 million were liquidated in a single day.
The exit of short-term long-position holders during Solana’s (SOL) price increase is a bullish signal for the altcoin. It indicates that these traders are taking profits in a controlled manner without impacting the ongoing uptrend.
Furthermore, with these short-term holders already out of the market, there’s less likelihood of a sudden increase in selling activity if SOL encounters resistance at higher levels. This could discourage the opening of new short positions by sellers, as there’s less anticipation of a large drop in price due to the absence of immediate selling pressure from long position holders. Therefore, this behavior contributes to a more stable upward move for SOL’s price.
Current market sentiment is tilting toward bearishness, as indicated by the declining long/short ratio, currently at 0.9298. This shows a dominance of short positions, which make up 52% of the market. Nevertheless, bulls are maintaining a strong presence with 48% of positions.
What’s Next For SOL Price?
In the last few hours, Solana has seen a notable upward price trend. It hit a high of $52 recently but failed to surge further due to selling pressure from bears. SOL price is expected to consolidate within that region in the coming hours. As of writing, SOL price trades at $50.5, surging over 11% in the last 24 hours.
Bulls are experiencing a slight retreat as the SOL price struggles to hold above $50; however, the interest from buyers continues to increase, as suggested by the repeated attempts for a breakout. This buying activity suggests that investors are bullish about overcoming the next resistance level at $59. If this happens, the SOL price might witness another surge and consolidate near $68-$80.
On the bearish side, bears are aiming for a decline below EMA20. A reverse below the $40-$45 zone will create strong selling, and the SOL price might once again validate the $30 level. However, this level will likely witness strong buying demand, creating rebound opportunities.
Source: https://coinpedia.org/altcoin/solana-breaks-above-50-for-the-first-time-in-1-5-years-with-17-million-in-short-liquidations-whats-next-for-sol-price/