- Based on the historical price momentum, there is a high possibility that Solana’s price could soar by 25% to the $160 level.
- $25 million worth of short positions will be liquidated if SOL hits the $131 level.
Amid the bearish market sentiment, Solana [SOL] appears poised for a massive upside rally due to its bullish price action pattern and strong on-chain metrics. In the past few days, despite a notable price decline across the cryptocurrency market, SOL has been consolidating near a crucial support level of $125.
Solana technical analysis and upcoming levels
Based on expert technical analysis, SOL appeared bullish at press time. Its Relative Strength Index (RSI) has formed a bullish divergence that signals a potential trend reversal from a downtrend to an uptrend.
This divergence occurs when the asset’s price continues to form lower lows, while the technical indicator forms higher lows during the same period.
Source: TradingView
Based on the historical price momentum, whenever SOL reaches its current support level, it tends to experience a massive price surge. This time, with bullish price action there is a high possibility that SOL price could soar by 25% to the $160 level.
Bullish on-chain metrics
CoinGlass’s SOL Long/Short ratio chart signals bullish market sentiment. According to the data, the ratio currently stands at 1.103, indicating that traders are more optimistic (A value above 1 signals bullishness).
Meanwhile, SOL’s open interest has increased by 3% in the last 24 hours, and it has been rising consistently over the past three days.
Source: Coinglass
A combination of rising open interest and a Long/Short ratio above 1 suggests a potential buying opportunity. Traders often use this to build long/short positions.
As of press time, the major liquidation levels were near $125 on the lower side and $131 on the upper side, as traders appear over-leveraged at these levels, according to the CoinGlass data.
Source: Coinglass
If the trader’s bullish sentiment fails and the SOL price drops to the $125.61 level, nearly $56 million worth of long positions will be liquidated.
Conversely, if sentiment remains bullish and the price reaches the $131 level, approximately $25 million worth of short positions will be liquidated.
Realistic or not, here’s SOL’s market cap in BTC’s terms
Looking at these data, it appears that bulls are currently dominating and have a high potential to liquidate short positions.
At press time, SOL was trading near the $130.40 level and has experienced a price surge of over 2.5% in the last 24 hours. Meanwhile, its trading volume declined by 65% during the same period, indicating lower trader participation due to the recent price drop.
