The price of Solana (SOL), the world’s fifth-largest cryptocurrency, has plunged significantly by more than 8% in the past 24 hours today, August 3, 2024. This drop has resulted in a sharp drop in the critical support level of $157.
Why is Solana (SOL) Falling?
With this drop, SOL turned bearish and is now heading towards the $125 level. Potential reasons for this price drop include the breakdown of key support levels and negative impact on major assets such as Bitcoin ( BTC ) and Ethereum ( ETH ).
SOL cost performance analysis
At press time, SOL is trading near $150, down more than 8% in the past 24 hours. Meanwhile, according to data from on-chain analytics firm CoinGlass, SOL’s open interest (OI) has also seen a significant drop of more than 8% in the same period. The drop in OI indicates a drop in fear and interest among investors and traders.
Additionally, traders and investors liquidated over $22.44 million in long and short positions during this price drop. However, due to the negative market sentiment, most of the liquidations came from long positions, with $16.22 million in long positions being liquidated. While only $6.22 million in short positions were liquidated in the past 24 hours.
Solana Key Levels
Despite the massive liquidations that have occurred over the past 24 hours, the upcoming liquidation levels are $146 on the lower side and $162 on the higher side at the time of writing.
If sentiment remains the same and SOL drops to the $146 level, nearly $40 million in long positions will be liquidated. Conversely, if sentiment changes and SOL reaches the $162 level, nearly $147 million in short positions will be liquidated.
Technical Analysis and Upcoming Levels
According to expert technical analysis, SOL looks bearish as it has given a breakdown of key support and the 200 exponential moving average (EMA) on the 4-hour timeframe. An asset trading below the 200 EMA on this timeframe signals potential bearishness.
Based on historical data and price momentum, there is a high probability that SOL will reach the $143 and $125 levels in the coming days. These levels are expected to provide support for SOL.
