Hey guys! Like I said in my last review - SOL went to close GAP from the bottom, gathering liquidity.
❓ GAP is almost closed and time to reflect, what's next?
The liquidity imbalance has gotten bigger. If, as recently as last week, there was 1.5 times more liquidity in shorts. Today liquidity in shorts is almost 4 times more than liquidity in longs.
Which means that most of the speculative positions have already been closed. Of course, the volume of liquidations is not even close to the peak, which indicates that there is still no fresh liquidity on the market and therefore it is difficult for the token to maintain the current momentum.
Besides, summer is coming soon and liquidity will only become less. But for SOL this is a plus rather than a minus and here's why:
⚙️ Metrics and Indictors:
VRVP - we are approaching one of the most active levels, in the 148-136 zone. This zone is where the largest area of trader interest is concentrated. And it is in this zone that I think a lot of people will start looking at SOL from a spot buying perspective.
RSI - is 40. It is not in the oversold zone yet, but the GAP is not closed to the end. That means that the probable continuation of the decline to the psychologically important level of 150-147, may provoke a decline to the oversold level and the beginning of short-term purchases by traders.
DLD - as already mentioned. Liquidity of shorts is now 4 times more than liquidity in longs. And as we know, the price moves from one liquidity to another, which acts as fuel for it.
📌 Conclusion:
Unlike ETH and even BTC - there is no more GAP below in SOL! This means that all further declines will be based on effectively traded zones where there is already organic supply and demand. So we are unlikely to see 20% drops overnight (unless if Trump don't do something weird).
Besides, there is a lot of liquidity in shorts at levels 185 - 201 (local double top of the current momentum).
Short squeezes in historically bearish patterns are not uncommon now. As traditional technical analysis has not been working as it should for a long time due to its proliferation.
So I see the first test of the 146 -141 level as the first possible point for a price reversal, at least to renew the local high.
🔥 Congratulations to everyone on the start of summer and have a good week!
❓ GAP is almost closed and time to reflect, what's next?
The liquidity imbalance has gotten bigger. If, as recently as last week, there was 1.5 times more liquidity in shorts. Today liquidity in shorts is almost 4 times more than liquidity in longs.
Which means that most of the speculative positions have already been closed. Of course, the volume of liquidations is not even close to the peak, which indicates that there is still no fresh liquidity on the market and therefore it is difficult for the token to maintain the current momentum.
Besides, summer is coming soon and liquidity will only become less. But for SOL this is a plus rather than a minus and here's why:
⚙️ Metrics and Indictors:
VRVP - we are approaching one of the most active levels, in the 148-136 zone. This zone is where the largest area of trader interest is concentrated. And it is in this zone that I think a lot of people will start looking at SOL from a spot buying perspective.
RSI - is 40. It is not in the oversold zone yet, but the GAP is not closed to the end. That means that the probable continuation of the decline to the psychologically important level of 150-147, may provoke a decline to the oversold level and the beginning of short-term purchases by traders.
DLD - as already mentioned. Liquidity of shorts is now 4 times more than liquidity in longs. And as we know, the price moves from one liquidity to another, which acts as fuel for it.
📌 Conclusion:
Unlike ETH and even BTC - there is no more GAP below in SOL! This means that all further declines will be based on effectively traded zones where there is already organic supply and demand. So we are unlikely to see 20% drops overnight (unless if Trump don't do something weird).
Besides, there is a lot of liquidity in shorts at levels 185 - 201 (local double top of the current momentum).
Short squeezes in historically bearish patterns are not uncommon now. As traditional technical analysis has not been working as it should for a long time due to its proliferation.
So I see the first test of the 146 -141 level as the first possible point for a price reversal, at least to renew the local high.
🔥 Congratulations to everyone on the start of summer and have a good week!
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.