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May 18, 2024
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Solana Faces Increased Selling Pressure – Here’s Why This Support Is Crucial For SOL Price

The post Solana Faces Increased Selling Pressure – Here’s Why This Support Is Crucial For SOL Price appeared first on Coinpedia Fintech News

Solana (SOL) has recently been in the spotlight, not just for its innovative technology but also for its price movements. The SOL price had been on a bullish run, gaining significant buying pressure following Ripple’s partial victory against the SEC. However, the tides seem to be turning for SOL. Despite the recent bullish charge, the SOL price is now facing increased selling pressure. This has left investors teetering on the edge of bearish momentum. 

Solana’s Total Liquidation Surges Above $30 Million 

Solana (SOL) has recently been making headlines, but not for the reasons its investors would hope. The total liquidation of SOL has surged above a staggering $30 million, a development that has shaken investors. This surge in liquidation has had a significant impact on the price of SOL, causing it to tumble near higher levels.

According to Coinglass data, Solana’s total liquidation surpassed the $30 million mark over the past four days. When the price of SOL rose above $26, it was not uncommon for short traders to liquidate their positions. Short traders, who bet on the price of an asset falling, would naturally want to exit their positions when the price rises to avoid further losses. However, what was surprising in this instance was the heavy liquidation by long traders as well. 

Long traders, who bet on the price of an asset rising, typically hold onto their positions in anticipation of further price increases. The fact that they, too, were liquidating heavily suggests that they did not anticipate further increases from that level and wanted to lock in their profits.

Ripple’s partial victory against the SEC adds to the bearish sentiment, as the SEC could appeal anytime, creating uncertainty for cryptocurrencies like SOL. This uncertainty has triggered bearish feelings among bullish holders, intensifying selling pressure and contributing to SOL’s recent price decline.

What’s Next For SOL Price?

Solana experienced a significant surge recently after hovering around the $22 resistance level for several days. This surge sent the price to a robust resistance at $30. As of writing, the SOL price trades at $27.1, declining by nearly 5% from yesterday’s rate. 

The bullish momentum was short-lived as the price quickly declined from its high, with the RSI level triggering a decline toward the midline from its overbought region. Currently, the SOL price is facing a decline in buying pressure, and bears are attempting to send the price below the immediate support line. 

If the price drops below the immediate support of $25 and the 23.6% Fib channel, it will trigger a steep fall and initiate a consolidation near the $20 mark. A further decline will result in the price hovering near $15. 

The upward key level to monitor is the breakout point at $30. If the bulls manage to convert this level into a support, the SOL price could potentially initiate a powerful rally toward $38-$39.

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