Solana at $170: Bulls and Bears Lock Horns in Make-or-Break Showdown

Solana’s price teeters at $170—a battleground where crypto’s irrational exuberance meets cold, hard resistance. Will the ’Ethereum killer’ rally past its demons, or get dragged down by another ’high-speed, low-substance’ narrative? Grab your popcorn.

Technical traders are eyeing the $170 level like hawks—break above, and bulls charge toward ATHs; fail, and it’s a one-way ticket to ’rekt’ city. Meanwhile, institutional bag-holders whisper about ’network resilience’ between sips of overpriced artisanal coffee.

The great bear fade

As AMBCrypto previously noted, Solana’s breakout above $170 wasn’t just a random spike. It was underpinned by solid structural demand and clean technical alignment.

Bulls executed with conviction at a key psychological resistance, flipping it into support and reclaiming a high-FOMO supply zone on strong volume. Consequently, nearly $20 million in short positions were wiped out.

Lookonchain data captured one such aggressive bet. A wallet deposited $1.21 million in USDC to open a 20x leveraged short on SOL at $164.9. 

The position ballooned to 97.5k SOL, with a tight liquidation level at $172.96. If SOL inches higher, that trade risks a forced exit. Another short squeeze brewing? All signs point to yes.

Solana’s risk-zone: The price of conviction

At press time, Solana traded at $171.87, setting up a potential liquidity trap for bears – again.

But this rally’s fate rests on bull conviction. If FOMO fades, what was once bullish momentum could quickly flip into a sharp reversal.

Signs of weakness are starting to emerge. Solana’s active address count has dropped sharply from 6.10 million to 5.40 million, representing an 11.46% decline in a single-day.

On top of that, the MVRV (Market Value to Realized Value) ratio is now sitting comfortably above 1, suggesting that SOL is trading well above its realized cost basis. 

Source: Glassnode

In other words, the market is flirting with overvaluation – prime conditions for a potential profit-taking cycle to kick in. 

Shorts are positioning themselves based on these on-chain signals. If structural demand continues to weaken, they could capitalize on the potential downside.

Solana is, without a doubt, in a high-stakes gamble. The momentum is leaning bullish, as market-wide FUD is at a lull. 

But a full-on rally? That still feels like a stretch. Bears are still in the mix, waiting for the right signal to reverse the trend.