Solana derivatives market shows a strong bearish positioning, with nearly a billion dollars in potential liquidations on the sellers' side. This extreme imbalance could trigger an unexpected rally. With technical squeezes and positive ETF flows, SOL is navigating crucial levels.
Seven-day liquidation data reveals a spectacular imbalance: short positions on Solana represent nearly double the long positions. This massive concentration of short sellers creates an explosive scenario where a relatively modest price movement could trigger a cascade of forced buybacks.
According to CoinGlass data, if SOL reaches $147 this week, up to $1 billion in short positions could be liquidated. This phenomenon would force sellers to buy back their positions urgently, mechanically amplifying the rally in what’s known as a short squeeze. Conversely, a drop below $120 would trigger approximately $500 million in long liquidations, creating a less significant but equally violent downward cascade.
This asymmetry in potential liquidations indicates that the market leans predominantly bearish. Paradoxically, it’s precisely this type of one-sided positioning that fuels the most violent counter-trend moves. Savvy traders monitor these levels as potential reversal zones rather than simple support or resistance areas.
Beyond the technical structure, several fundamental elements strengthen the scenario of a move toward $147. Spot Solana ETFs are displaying a series of positive inflows over seven consecutive days, even as the pace slightly decelerates. This persistent trend demonstrates institutional conviction that contrasts with the bearish positioning of derivatives traders.
SoSoValue data confirms this interesting divergence between retail sentiment and institutional appetite. While speculative traders accumulate short positions, long-term investors continue to allocate capital through regulated vehicles. This dynamic resembles pre-rally configurations observed in other major crypto assets.
The Solana ecosystem is also benefiting from concrete developments that reinforce its value proposition. The partnership between XRP and Hex Trust to expand DeFi use cases on Solana, along with the Project Eleven initiative for post-quantum security, demonstrate that technical innovation continues despite price volatility. Furthermore, Visa announced the deployment of USDC payments on Solana. This could reignite appetite from large wallets.
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From a technical perspective, Solana is in a tight range with particularly violent movements, making prediction and analysis difficult.
Nevertheless, a bullish divergence in the RSI is emerging as SOL rebounded above its bullish trendline. The threshold between $126 and $124 must hold; otherwise, SOL will plunge to $116-$109.
But for now, SOL can target $132 to $134 at any time. Subsequently, the zone between $140 and $146 is the next target if SOL maintains $134 as support.
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Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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