Solana’s $120 Liquidation Battle: Why Long-Term Bulls Are Still Charging

Solana isn't just trading—it's fighting for its life near a critical $120 line. The market's liquidation engines are roaring, threatening to swallow over-leveraged positions whole. Yet, beneath the short-term chaos, the fundamental case for this high-speed blockchain hasn't been shredded.

The Pressure Cooker at $120

Price isn't just a number here; it's a trigger. A sustained break below $120 could unleash a cascade of automated sell-offs—the kind that turns a dip into a dive. Traders are watching the order books like hawks, knowing one large, panicked move could tip the scales. It's the crypto version of watching a dam for cracks.

The Bull Case That Won't Die

Forget the hourly charts for a minute. The narrative that propelled Solana to its previous heights—blazing transaction speeds, rock-bottom fees, and a developer ecosystem that's actually building—hasn't vanished. Network activity and developer engagement remain key metrics to watch, often providing a clearer signal than the manic-depressive spot price. It's the old finance-world dilemma: price versus value, with the former being a notoriously fickle friend.

Navigating the Storm

Smart money isn't just staring at the $120 level; it's planning for what comes after. A decisive hold could signal a local bottom and fuel a relief rally. A breakdown, however, would reset the board and establish a new, lower battleground. Either way, volatility is the only guaranteed outcome—a trader's dream and a traditional portfolio manager's recurring nightmare (along with their 2% management fee, of course).

The showdown at $120 is a brutal test of sentiment. But for those who believe in the tech over the ticker, this isn't an obituary—it's a stress test. The outcome will separate the leveraged tourists from the long-term believers.

Solana Long-Term Structure Holds as Resistance Builds Above

In a broader perspective, solana is seen to be trading under critical levels of support, including the 0.786 level at $138 to $141. It has not recently managed to recover above the 0.618 level at $160.

Critical levels of support are also found to align with the 20-week and 50-week averages, thus presenting a robust level of resistance in the range of $150 to $166.

Source: Tradingview

The momentum indicators reflect steady selling, not a panic sell-off. The RSI for the week is approximately 36, close to the oversold levels. It implies that sellers are working, but their momentum is gradually waning.

Also, in the past, such levels tended to result in a sideways or a mild correction when the markets reached the long-term averages.

Liquidation Zones Could Decide the Next Move

However, in the short term, there may be risks in terms of price movements. Analyst Ted points out that there are huge areas of liquidation on both sides for SOL.

However, if it approaches the area around $126 to $130, lots of shorts might get unwound, causing the price to rise. But if it breaks $120, lots of long positions WOULD get liquidated, leading to a drop in price to around $100 or $85.

Source: X

At the moment, Solana is facing a critical phase. As long as it remains above $120, the range-bound formation possibility and the potential rally continue intact. A close above $150 will further strengthen the bulls.

Currently, the market will continue in the range with some selling pressures, but the outlook will remain positive.