Solana (SOL) is once again under the spotlight as a newly created whale wallet withdrew 20,009 SOL (worth $3.53 million) from Binance and immediately staked 19,875 SOL, showing strong conviction in the asset’s long-term prospects. Additionally, 134 SOL was transferred to another staking address, increasing total staked holdings to 9,270.4 SOL, or $1.6 million.
This substantial staking activity typically reflects a bullish outlook and long-term commitment. However, the broader market response has remained cautious, signaling a potential disconnect between on-chain optimism and actual trading dynamics.
Long Liquidations Soar as Market Punishes Overleveraged Bulls
Despite the bullish whale activity, $6.1 million in long positions were liquidated on May 25, a staggering contrast to only $326K in short liquidations, according to Coinglass data. Binance alone accounted for $2.76 million of those liquidations.
This significant imbalance highlights how overly bullish traders were caught off guard by recent price volatility. Historically, such liquidation events often suggest a market reset or even a deeper bearish trend forming beneath the surface.
Retail Sentiment Still Bullish—But Is It Misplaced?
Interestingly, data from Binance revealed that 68.95% of traders remain long on SOL, with a long/short ratio of 2.22. While this shows continued optimism among retail participants, it also sets up the potential for more volatility.
Excessive bullish sentiment, particularly after a liquidation event, often leads to further shakeouts. If Solana’s price continues to stall or drops again, those long positions could be at renewed risk of liquidation.
Technical Analysis: $193 Resistance Remains Key
At press time, SOL is trading around $172.34, and continues to struggle against the 0.786 Fibonacci resistance at $193. The Relative Strength Index (RSI) has cooled to 61.87, signaling waning bullish momentum despite a recent rebound.
For bulls to regain dominance, a clear breakout above $193 is crucial. If successful, the next target would be the Fib extension at $229.46. However, multiple failures at this level may confirm a range-bound pattern—or worse, a downside continuation.
Despite Whale Confidence, Outflows Still Dominate
Solana’s spot market activity on May 25 revealed $158.93 million in outflows versus $141.42 million in inflows, resulting in a net outflow. This suggests that while some whales are accumulating, broader investor sentiment remains cautious, with many exiting their positions.
Until inflows sustainably outpace outflows, bullish staking activity alone may not be enough to reverse the current price pressure. Market participants remain focused on the tug-of-war between long-term confidence and near-term volatility.
Conclusion: Consolidation or Breakdown Ahead?
Solana finds itself at a crossroads. On one hand, whale staking hints at strong long-term belief in the network. On the other, persistent liquidation spikes, net outflows, and technical resistance at $193 indicate that upside potential remains uncertain in the short term.
Unless bullish traders regain momentum and break critical resistance levels, SOL may face extended consolidation or further downside risk.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are volatile and risky. Always conduct your research before making any investment decisions.
