- Solana trades at $161.26, with a market cap of $74.8 billion, ranking as the fifth-largest cryptocurrency.
- Potential $3 billion in liquidations if Solana hits $176, indicating a shift towards a price correction.
Solana, a leading cryptocurrency, is currently trading at $158.26 with a market capitalization of $74.8 billion, making it the fifth largest in its category.
Over the past week, Solana has experienced a notable increase of more than 12% in its price, with a 5% rise in the last 24 hours alone. This bullish trend reflects a sustained control by buyers in the market.
Despite these gains, Solana faces potential challenges ahead. According to ETHNews, a surge to $176 could result in nearly $3 billion in liquidations of short positions. This situation often leads to a short- to midterm correction in price.
Analysis of Santiment’s data supports this, showing an increase in trading volume which traditionally signals a continued price rise. However, the market sentiment appears to be shifting, with an increase in bearish views as indicated by the drop in the Weighted Sentiment.
Further complicating matters, analysis from Coinglass suggests a decrease in the Long/Short Ratio, pointing to a growing bearish sentiment among traders. Moreover, the ‘fear and greed index’ has reached a phase of ‘extreme greed,’ which historically precedes a market correction.
Observations from SOL’s daily chart indicate that the price recently touched the upper limit of the Bollinger Bands—an indicator often associated with overbought conditions. Additionally, a decrease in the Chaikin Money Flow hints at decreasing buying pressure, despite the Moving Average Convergence Divergence (MACD) continuing to show support for an upward trend.
Crypto analyst Ali noted on X that if Solana reaches the $176 mark, it could trigger substantial market movements due to the liquidation of $2.98 billion in short positions. This scenario underscores the volatile nature of cryptocurrency markets and the high stakes involved in trading decisions.
A continued rise could see it reaching higher benchmarks, but the potential for a significant correction looms, indicating that traders and investors must remain vigilant.
