Solana (SOL) dropped 3.27% to $171.07 on May 25, 2025, after briefly spiking above $181 due to Trump memecoin controversy
Despite the pullback, SOL remains up 7% for the week and 16.9% over the last 30 days
Long liquidations surged to $6.1 million while short liquidations were only $326K, showing bearish pressure on overleveraged bulls
A whale withdrew $3.53 million worth of SOL from Binance and immediately staked most of it, indicating long-term confidence
SOL struggles to break past $193 resistance level with spot outflows of $158.93 million exceeding inflows of $141.42 million
Solana experienced sharp price swings over the weekend as political controversy and market dynamics created turbulence for the fifth-largest cryptocurrency.
SOL fell 3.27% to $171.07 on May 25, 2025, retreating from Friday’s brief spike above $181. The volatility stemmed from a politically charged event involving a Trump memecoin dinner hosted on the Solana blockchain.
The controversy caused market jitters and triggered a quick sell-off. Despite this setback, Solana briefly overtook Binance Coin as the fifth-largest cryptocurrency by market cap during the initial surge.
SOL maintains weekly gains of 7% and monthly increases of 16.9%. The token reached a 60-day high of $186 before the recent pullback began.
Derivatives data reveals mixed sentiment among traders. SOL futures volume dropped 46.4% to $11.31 billion, while open interest declined 3.8% to $7.35 billion.
Options volume fell even more sharply, down 67% to $653,270. However, options open interest increased 2.3% to $10.84 million.
Long liquidations dominated the market on May 25, reaching $6.1 million across major exchanges. Short liquidations totaled just $326,000, creating a stark imbalance.
Binance alone accounted for $2.76 million in long liquidations. This pattern typically signals cooling market conditions or potential trend reversals.
The liquidation wave flushed out overleveraged bullish positions. Recent total liquidations reached $13.4 million, with $12.3 million coming from long positions.
Despite the shakeout, 68.95% of traders on Binance maintained long positions. The long-short ratio stood at 2.22, showing persistent bullish sentiment among retail traders.
This lopsided positioning often precedes further volatility. If SOL continues sideways movement or drops lower, these long positions could face additional liquidation pressure.
Whale Activity Signals Long-Term Confidence
A newly created wallet withdrew 20,009 SOL worth $3.53 million from Binance on May 26. The wallet immediately staked 19,875 SOL, demonstrating long-term conviction.
The same wallet sent 134 SOL to another staking address. Total staked holdings reached 9,270.4 SOL, equivalent to $1.6 million.
This staking activity indicates confidence in Solana’s future prospects. However, broader market signals have not yet aligned to support a strong upward trend.
SOL currently trades at $172.34, struggling to break past the key resistance level at $193. The token has repeatedly failed to reclaim this crucial Fibonacci resistance zone.
The Relative Strength Index cooled to 61.87 from previous highs. While this level still shows mild bullish control, it lacks the strength needed to confirm a breakout.
Spot market flows on May 25 showed $158.93 million in outflows compared to $141.42 million in inflows. This net outflow suggests broader market participants continue exiting positions despite whale accumulation.
Technical analysis reveals SOL broke below its ascending channel and the 50-period EMA at $174.56. The MACD indicator shows a bearish crossover with widening histogram, indicating selling pressure.
Price currently tests immediate support at $173.06. A break below this level could target $165.50, then $159.57 and $153.94.
For bulls to regain control, SOL needs to reclaim levels above $178.00 and $182.38. If Bitcoin stabilizes above $106,000, Solana could retest the $187-190 zone with eyes on the $210 target.
However, failure to hold support at $173-174 may trigger a correction toward $170.24 or even $160. The market remains at a critical juncture with mixed signals from derivatives positioning and on-chain activity.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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