Solana traders were dealt a crushing blow on Monday as nearly $20 million worth of long positions were liquidated, sparked by a sudden crash in the price of SOL that saw the altcoin plunge almost 13% in value. This massive single-day drop marked the most significant setback for Solana bulls in months. It came just as SOL was cementing itself as one of the standout performers in the crypto sphere in 2023, having rallied a whopping 600% since the start of the year.
The ferocious sell-off caught scores of enthusiastic traders off guard. They had banked on Solana continuing its epic run-up to reach the psychologically important $80 price point by the year’s end. Instead, they helplessly watched their leveraged bets unravel as SOL rapidly sank to a low of $68 after hitting resistance. The breathtaking descent resulted in nearly $20 million worth of optimistic long positions being forcefully shuttered – the largest liquidation event SOL has suffered in the last three months.
SOL has since bounced off its lows and is currently trading around the $71 level as bulls work on engineering a recovery. The coming days will likely determine if the asset can recoup its losses. If Solana can reclaim $71 and establish it as firm support, it could provide the platform for the price to ascend toward the next overhead resistance around $78. Breaching that would signify SOL setting fresh highs for 2023.
Meanwhile, some near-term technical indicators have tilted bullishly, signaling the potential for a relief rally. However, failure to hold $71 could spell more trouble and see SOL spiral lower to test underlying support at $66. Sliding beneath that critical buffer could invalidate any bullish projections and leave the asset vulnerable to a decline towards $61. So while there remains a chance for Solana to rediscover its mojo, the price remains on fragile ground overall.
