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Enter the cryptocurrency market in the first week of February with an intense battle between bulls and bears. The Bears have had the edge so far, but the Bulls are starting to see an opportunity. This situation made the price volatility more complex. The magnitude of liquidation losses is increased for both long and short positions.
Why should altcoins like Solana (SOL), Hyperliquid (HYPE) and Tron (TRX) be watched closely? The following article goes into the details.
1. Solana (SOL)
In the first days of February, Solana recorded a temporary decrease below $100 amid the general negative pressure of the market.
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The 7-day liquidation heatmap showed that the potential liquidation from short positions is dominant. Short-term leveraged traders showed their belief that Solana could fall further.
However, a price close to $100 has placed Solana in its most important support zone in the last two years. Increasing leverage and capital to sell in a major support zone is often fraught with significant risk.
A recent analysis by Pinkrypto sheds light Strong increase in new Solana titles During January. More than 10 million new addresses created every day.
He also said There are several emerging factors that can support recovery. These factors include user growth thanks to meme launchers, the expansion of the USD1 stablecoin, and Solana joining the general privacy trend via JustSoap.
The selling pressure from the general pessimism collided with Solana’s bullish catalysts around the $100 level. This conflict can lead to Strong price movements. Long and short trend translators face liquidation risk.
Coiniglass date indicated if Solana recovers above $ 113 this week, liquidation of short positions could reach $ 500 million. If Solana continues to fall towards $86, long positions may suffer liquidation of more than $142 million.
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2. Hyperlicode (HYPE)
HyperLiquid (HYPE) continues to be one of the few altcoins to achieve a 50% rally from the January 21st low. In contrast, most other currencies recorded new lows.
The settlement chart for HYPE appeared to reflect a relatively balanced position between long and short positions. At the current price near $31, a rise towards $35.5 could lead to the liquidation of about $80 million of short positions. A drop toward $26 could also cause about $80 million of long positions to be liquidated.
HYPE’s ability to rise against the general market trend is already a risk. BeInCrypto also reports Large capital flowsWhile the market lacks enough liquidity to support the recovery.
On the other hand, HYPE has its own incentives. These stimuli include: 90% reduction in monthly team assignments. He also supported the demand for trade Metal pairs on the Hyperliquid platform Currency rate.
Bulls and bears neutralize each other. Over the past four days, HYPE has formed successive candlestick patterns spin top. This formation often indicates that a significant price movement may be imminent, increasing the risk of liquidation.
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3. TRX
Recently, a woman named Tenten (Zing Ying), who claims to be Justin Sun’s ex-girlfriend, said that He manipulated the TRON (TRX) market in its early days. It is confirmed that Sun ordered employees to open multiple accounts on the Binance platform in personal names to make coordinated trades.
These developments could spread negative sentiment among TRX holders, especially amid a wave of panic selling.
Short-term traders bet on more downside. The contract liquidation map shows the potential for short position liquidations to dominate. These liquidations could reach around $29 million if TRX rebounds above $0.31.
Other signs have indicated that the demand for TRX is even stronger. Tron Inc. (NASDAQ: TRON ) recently With purchase 173,051 additional TRX tokens at an average price of $0.29. The company’s total TRX reserves now exceed 2.679 million TRX.
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The number of weekly active addresses on the Tron network has been growing steadily for several years. Currently it is 24.68 million. This shows that the demand for TRX remains supported even during a larger market decline.
Short sellers can make short-term profits while negative sentiment prevails. However, without a clear plan to make profits, those profits can disappear quickly.
Each of these altcoins has its own history. As market volatility continues to rise, liquidation risk has increased sharply for both long and short traders.
The total liquidation of cryptocurrencies has officially exceeded $5 billion in the last four days, marking the largest wave of liquidations since October 10, The Copy Letter reported.
As liquidation losses increase, individual investors’ capital may be depleted and no longer sufficient to support buying pressure. This may push the market to… Prolonged stagnation phase.
