Solana (SOL) has surged past the $160 price mark, signaling a positive trend in the market.
On-chain analyst Ali predicted a potential $2.98 billion short position liquidation at Solana’s $176 price zone.
While the global crypto market turns green for the week with Bitcoin (BTC) climbing to $63,000, the leading altcoin Solana (SOL) breaches the $160 zone after five weeks of consolidation. This positive trend is fueling optimism among investors and analysts alike.
According to on-chain analyst @ali_charts, if Solana’s price reaches $176, it could trigger the liquidation of short positions worth approximately $2.98 billion. The liquidation of short positions can lead to a rapid increase in price due to a phenomenon known as a “short squeeze.”
When short positions are liquidated, those who have bet against the asset are forced to buy it back to cover their positions. This sudden buying pressure adds to the existing demand, pushing the price even higher. If SOL reaches $176 and triggers $2.98 billion in liquidations, the influx of buying to cover shorts may significantly drive up the price.
Since mid-June, SOL’s price has swung between $130 and $150, even dipping below $123 in early July. However, a recovery initiated on July 14th saw SOL peak at over $160 on July 16th before consolidating.
At the time of writing, SOL is trading at $155 with a 24-hour trading volume of $2.76 billion. This marks a 9% increase over the last week and a 7.5% rise over the past two weeks.
Will Solana’s (SOL) Price Climb Above $160?
As SOL has rebounded multiple times from the lower support zone around $125 and broken out of a crucial range, it has formed a bullish pattern, potentially setting the stage for a new upward movement.
Solana (SOL) Price Chart (Source: TradingView )
The daily price chart shows a 50-day EMA, indicating that SOL has been trading mostly between the upper and middle bullish trends. Additionally, the RSI is in the overbought zone, which could suggest continued upward momentum.
If SOL maintains its rally, key resistance levels to watch include $165, $170, $175, and $180. Surpassing these levels could propel SOL into the $200 range. Conversely, if liquidations occur, immediate support levels are expected between $140 and $145, with more bearish scenarios seeing declines to $133 or even $125.
However, the overall market sentiment for Solana is currently bullish, with expectations of further price increases. A breakout above $160 and $165 could signal the start of a sustained upward trend, potentially validating @ali_charts’ prediction of a significant liquidation event at $176.
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