SOL's Open Interest hits an all-time high, while funding rates and short positions fuel speculation about a potential $264 breakout.
derivatives market is heating up and attracting traders worldwide. Its Open Interest has reached unprecedented levels as the tug-of-war between bulls and bears intensifies.
After sharply bouncing off a key support level, the question now is whether Solana can sustain the momentum and climb toward $264 or if bearish sentiment will force it to retreat.Solana’s derivatives market saw a significant surge in November, reaching historic open interest levels. This increase indicates heightened trading activity and could signal major price swings.Despite the rally, SOL’s funding rates tell a different story.
Currently, bearish funding rates slightly outnumber the bullish ones. This imbalance could trigger a dramatic price move as market participants adjust their positions.At the time of writing, the Long/Short Ratio for SOL stood at 0.89, underlining a bearish dominance. Short positions make up 52% of the market, indicating skepticism of the sustained upward momentum.
However, the 10% SOL recovery in less than 48 hours challenges such doubts, signaling that buyers are stepping in at crucial levels.Solana saw a sharp reversal from a crucial support zone that sparked a swift rally. This has been quite the opposite of the short-heavy sentiment, underlining strong buyer conviction.
If this momentum is sustained, SOL could breach psychological and technical resistance around $240, opening up a path towards $264.If buying pressure continues and shorts begin to cover their positions, a rally toward $264 could be on the horizon.Kelvin Murithi is a freelancer cryptocurrency price analyst working with AMBCrypto. He has significant experience in financial markets and digital assets. He also has a background in market analysis, investment strategies, and economic forecasting.
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