SOL Price Plummets Amidst Initial Ripple (XRP) ETF Rumor, Traders Face Liquidations
Crypto News – Traders who had eagerly opened multiple Solana (SOL) futures positions in anticipation of profiting from its recent upward trajectory were taken by surprise on November 13th. This sudden shock came as the price of SOL, which had been consistently ascending for weeks, unexpectedly plummeted.
As per the latest data from CoinMarketCap, SOL’s price stood at $54.66 at the time of writing, marking a notable 6.37% decrease within the last 24 hours. Many within the cryptocurrency market attributed this sharp decline to rumors surrounding the initial appearance of a Ripple (XRP) ETF.
SOL wasn’t the sole digital asset affected by this market turbulence. Bitcoin (BTC) and Ethereum (ETH), according to data from Coinglass, experienced the highest number of liquidations within the past 24 hours. Notably, SOL closely followed, witnessing a substantial $12.64 million in liquidations during the same timeframe.
A closer examination of derivative information revealed that SOL long positions bore the brunt of these liquidations, totaling $8.74 million, while short positions experienced slightly over half of the long liquidations.
One of the contributing factors to SOL’s position among the top three assets facing liquidations was its price performance over the past three months. Over this period, SOL had surged by an impressive 131.98%. Given such substantial gains, it was almost inevitable for market participants to seek opportunities to capitalize on the token’s bullish trend.
Amidst the market uncertainty spurred by this sudden downturn, open interest in Solana experienced an 11% decline. Open interest, signifying the number of outstanding contracts in the market, typically rises with increased trading interest and open positions. Conversely, a decrease suggests that traders are increasingly closing their positions, possibly driven by profit-taking or, as observed in SOL’s case, a shift in market sentiment and direction.
The decline in open interest coupled with the falling price is considered a bearish sign, potentially indicating further downside for SOL from its current $54 level. This sentiment was corroborated by the Moving Average Convergence Divergence (MACD), which registered at -1.023, indicative of waning buying momentum.
Additionally, the 12-day moving average crossing above the 26-day moving average (orange line above blue) suggests that sellers currently hold sway in the market. Nevertheless, there is a glimmer of hope for SOL’s short-term recovery, with the 9-day exponential moving average (blue) maintaining its position above the 20-day exponential moving average (yellow). This configuration is typically interpreted as bullish, hinting at the potential for SOL to retrace to around $52 to $50, and with renewed buying pressure, it may only be a matter of time before it reclaims the $60 mark.