TL;DR
- SOL’s price retreated 4% in 24 hours, reaching lows not seen in several weeks.
- Long position liquidations exceeded $20 million in the derivatives market.
- Analysts warn that a break below the $125 support could drive the price toward $120.
This January 20th, the crypto market session is marked by high volatility, with Solana slides below $130 following a generalized correction. Furthermore, the day was characterized by intense selling pressure that dragged Bitcoin down to $90,600, significantly impacting investor sentiment.
Despite recently reaching a $1 billion milestone in Real-World Assets (RWA), short-term bullish momentum seems to be vanishing. Global economic uncertainty and sector-wide volatility have caused over 95% of SOL liquidations to consist of over-leveraged bullish bets.
Technical Analysis: Is the $120 Support Inevitable?
Technically speaking, the scenario turned bearish after the asset lost its 20-day and 50-day exponential moving averages (EMAs). Currently, the RSI stands at 41 points, suggesting there is still room for further downward movement before entering oversold territory.
On the other hand, institutional flows present a mixed picture, as US spot Solana ETFs recorded net inflows of $47 million last week. Nevertheless, aggressive selling in the spot market threatens to erode this institutional support, increasing the risk of larger capital outflows.
In summary, if the support level situated between $125 and $126 fails to hold the price, we may see a visit to the psychological level of $120. However, any recovery attempt will face immediate resistance in the $137 zone, where the current supply is concentrated.
