- SOL showed a 2.14% gain, reaching $171 and approaching the $176-$188 resistance zone.
- Solana Social Dominance increased to 5.18%, indicating a resurgence in retail interest as technical indicators turn positive.
Solana [SOL] has been on an upward trend, regaining bullish momentum as it tests a crucial resistance area between $176 and $188. The price has rebounded strongly from recent lows and seems ready to challenge this resistance zone.
As of now, SOL has risen by 2.14% in the last 24 hours to trade at $171.47.
This recovery comes as Solana shows strength in technical indicators and derivatives activity, with signs of vulnerability on the short side just above current levels.
Can bulls trigger a short squeeze?
Liquidation heatmaps indicate a cluster of overleveraged short positions between $170 and $176.
With SOL hovering around $171, a move above $176 could lead to liquidations and drive further upside momentum.
On May 18th, total short liquidations surpassed $1.72 million, while long liquidations remained minimal.
This imbalance sets the stage for a potential scenario where an increase in upside volatility could trigger a cascade of short liquidations, accelerating the price movement.
Source: CoinGlass
Funding Rates turn positive after a prolonged bearish period
Additionally, Funding Rates on Binance have shifted slightly to 0.008% after being in the negative for weeks.
This change indicates a growing inclination among traders to hold long positions, signaling a shift in sentiment.
While the rate is modest, it reflects a reduction in bearish bias and an increase in trader confidence in Solana’s upside potential. Continued positive funding could attract more leveraged long positions, reinforcing bullish momentum.
Source: Santiment
Increased social buzz as retail interest resurges
Meanwhile, Social Dominance for Solana rose to 5.18%, bouncing back from a decline over the past few weeks. This uptick indicates a renewed interest from retail investors, typically seen during bullish phases.
Although the current level is below the spike in March, it signifies a growing engagement within the community.
If the price breaks the resistance, social activity may intensify and further boost bullish momentum.
Source: Santiment
Is SOL gearing up for a breakout? MACD and Fib indicators suggest so
From a technical standpoint, Solana remains above the 1.618 Fibonacci extension at $163.16, a critical support level that has held during recent volatility.
Simultaneously, the MACD is converging near the zero line, hinting at a potential bullish crossover in the coming days.
These patterns support a scenario where SOL could surpass $176 and target higher levels at $189.88 and $198.13, based on higher Fib levels.
Momentum indicators are strengthening, increasing the likelihood of a breakout.
Source: TradingView
Development activity remains steady amidst market volatility
Furthermore, it’s not just hype driving the price.
Solana’s Development Activity stands at 23.38, indicating a strong confidence among builders.
Although there was a slight dip from previous highs, it continues to show confidence among developers and maintains the network’s fundamentals.
Consistent development helps build long-term investor confidence and can support price rallies based on more than just speculation.
Source: Santiment
Will SOL overcome resistance and spark a rally?
All indicators point to a potential breakout as SOL tests a significant resistance range.
From liquidation pressure and increasing social interest to improving technicals and consistent development, all the factors are aligning for a possible rally.
If bulls manage to breach the $176-$188 zone, Solana could initiate a sustained rally towards higher extension targets.
sentence: The cat chased the mouse around the house.
Rewritten sentence: Around the house, the mouse was chased by the cat.