Solana Surges 10% to $190 as Shorts Liquidate $7.9 Million

Solana's price action has been notably bullish, with the cryptocurrency testing the $190 mark. This movement has been accompanied by significant short liquidations, indicating that traders who had bet against Solana are being forced to close their positions at a loss. The aggressive long positioning around the $185 mark, as evidenced by rising funding rates and short liquidations, suggests that many traders are confident in Solana's upward trajectory.

Solana's price chart shows a classic cup-and-handle breakout pattern, which is often a precursor to explosive price movements. The current price action is testing a key resistance zone between $180 and $210, and a successful breakout could lead to substantial gains. This bullish sentiment is further supported by improving market conditions and positive crowd and smart money sentiment scores of 0.63 and 1.45, respectively.

The derivatives market has seen a surge in activity, with funding rates turning positive and open interest (OI) increasing by 8.25% to $7.86 billion. This indicates that traders are willing to pay a premium to hold long positions, reflecting bullish expectations. Additionally, options volume has surged by 38.12% to $1.64 million, highlighting the speculative appetite in the market.

Short squeezes could play a significant role in driving the next leg of Solana's rally. The liquidation heatmap shows that over $7.9 million worth of shorts have been liquidated recently, with a large share of this pressure coming from major exchanges. This imbalance could amplify volatility, as further upside may trigger cascading liquidations of overleveraged shorts. If the price pushes beyond $187–$190, Solana could enter an accelerated breakout phase as short sellers scramble to close their positions.

Despite the bullish indicators, spot volume has dropped significantly, falling over 30% to $13.99 billion. This decline raises questions about the sustainability of the current rally. However, sentiment remains strongly positive, and the growth in open interest suggests that leverage is replacing spot activity in fueling price momentum. Additionally, the decline in options open interest by 8.40% indicates that some traders are unwinding hedges in favor of directional exposure.

Solana's price is currently above the 0.382 Fibonacci level at $183.67. A clean break above this level could pave the way for further gains, with the next Fibonacci levels at $206.43 and $229.18. If momentum holds, the full pattern extension points toward $302.85. However, failure to hold above $183 could force a retest of the $155 zone, invalidating the bullish setup. The Relative Strength Index (RSI) stands at 54.94, indicating neutral momentum with room for expansion in either direction.

In conclusion, Solana appears poised for a sustained breakout. The cup-and-handle pattern, surging open interest, and rising funding rates all reinforce the bullish continuation. Despite the drop in spot volume, sentiment remains strong, and short liquidations above $185 are fueling upward momentum. With the price holding firmly above the 0.382 Fibonacci level, a rally toward $206 and $229 is now the most probable outcome. Solana's structure and metrics confirm that the next leg up has already begun.