TLDR
- Solana (SOL) dropped 3.27% to $171.07 on May 25, 2025, after briefly spiking above $181 following Trump memecoin controversy
- Long liquidations reached $6.1 million, vastly exceeding $326K in short liquidations, showing bearish pressure on overleveraged positions
- A whale withdrew $3.53 million worth of SOL from Binance and staked nearly all of it, showing long-term confidence
- SOL struggles to break $193 resistance level with persistent spot outflows of $158.93 million outweighing $141.42 million in inflows
- Despite heavy liquidations, 69% of traders remain long on SOL with a long/short ratio of 2.22
Solana price faced intense selling pressure over the weekend, dropping 3.27% to $171.07 on May 25, 2025. The decline came after SOL briefly spiked above $181 amid market volatility tied to Trump memecoin activity on the Solana blockchain.
The weekend’s price action highlighted the fragile nature of SOL’s recent gains. Despite being up 7% for the week and 16.9% over the past 30 days, the cryptocurrency struggled to maintain momentum above key resistance levels.
Market data revealed a harsh reality for bullish traders. Long liquidations surged to $6.1 million across major exchanges on May 25, dwarfing the mere $326,000 in short liquidations. This stark imbalance reflected the market’s punishment of overleveraged bullish positions.
Binance alone accounted for $2.76 million in long liquidations. The exchange dominated the sell-side momentum as traders faced margin calls during the price decline.
The liquidation data painted a clear picture of market stress. Historically, such skewed liquidation patterns often signal cooling market conditions or potential trend reversals.
Additional liquidation data showed $13.4 million in total liquidations, with $12.3 million coming from long positions. This further emphasized the bearish pressure facing bullish traders.
Whale Activity Shows Long-Term Confidence
Contrasting the bearish price action, whale activity told a different story. A newly created wallet withdrew 20,009 SOL worth $3.53 million from Binance and immediately staked 19,875 SOL.
The same wallet sent 134 SOL to another staking address. This brought the total staked holdings to 9,270.4 SOL, equivalent to $1.6 million at current prices.
This heavy staking activity indicated long-term conviction among large holders. However, the market reaction remained subdued despite this show of confidence.
The disconnect between whale accumulation and price performance highlighted the complex dynamics at play. While institutional money showed faith in SOL’s future, retail sentiment faced challenges.
Technical Resistance Proves Stubborn
SOL traded at $172.34 at press time, still struggling to break past the 0.786 Fibonacci resistance at $193. This level has proven to be a persistent barrier for bullish momentum.
The Relative Strength Index cooled to 61.87 from previous highs. While this level still showed mild bullish control, it lacked the strength needed to confirm a breakout.
For bulls to regain control, reclaiming $193 remains essential. Success here could target the next Fibonacci zone at $229.46.
The 2-hour chart showed SOL trading below its ascending channel and the 50-period EMA at $174.56. The MACD indicator displayed a bearish crossover with a widening histogram, indicating selling pressure.
Immediate support sat at $173.06. A break below this level could target $165.50, followed by $159.57 and $153.94.
Key resistance levels included $178.00 and $182.38 for any potential recovery attempts.
Spot Market Flows Remain Negative
Spot market activity on May 25 showed persistent selling pressure. Outflows reached $158.93 million compared to inflows of $141.42 million, resulting in net outflows.
This divergence suggested that while some whales accumulated, broader market participants continued exiting positions. The data indicated ongoing profit-taking or repositioning activity among retail investors.
Even with growing staking confidence, price performance remained muted. Unless inflows sustainably outpaced outflows, upside potential would remain capped.
The sell-side signals continued to dampen the impact of bullish on-chain events like whale staking activity.
Trader Sentiment Remains Bullish Despite Losses
Despite the liquidation wave, 68.95% of traders held long positions in SOL according to Binance data. The long/short ratio stood at 2.22, showing continued retail optimism.
This lopsided sentiment often precedes further volatility or additional shakeouts. If SOL continues sideways movement or drops lower, these long positions could face renewed liquidation pressure.
The data suggested a disconnect between trader expectations and actual price momentum. Most retail participants remained bullish despite recent setbacks.
OKX showed a similar pattern with a long/short ratio of 2.25. High-frequency traders on Binance displayed even higher ratios at 2.1456 and 2.3825.
Derivatives Market Shows Mixed Signals
Futures volume dropped 46.4% to $11.31 billion following SOL’s peak at $186. Open interest decreased 3.8% to $7.35 billion, reflecting reduced trading activity.
Options volume fell 67% to $653,270, while open interest increased 2.3% to $10.84 million. The mixed derivatives data suggested uncertainty about SOL’s near-term direction.
The recent liquidations may have cleared out overextended positions. This could provide a foundation for recovery if Bitcoin stabilizes above $106,000.
However, the reduction in trading volume indicated decreased market participation. Lower volumes often accompany consolidation periods or trend reversals.
Solana faces a critical juncture with key support at $173-174 and resistance at $193, requiring sustained buying pressure to break higher.
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