3 Altcoins Facing Major Liquidation Risks in the First Week of March

Escalating geopolitical tensions over the weekend did not trigger severe capital outflows from altcoins. This test suggests that altcoin prices are hovering around equilibrium levels and are preparing for a significant move. As a result, the market also carries the potential for large-scale liquidations.

Altcoins such as SOL, XRP, and XAUT each have distinct drivers that could soon spark volatility and liquidations on both Long and Short positions.

1. Solana (SOL)

SOL has traded sideways around $84 since early February. Maintaining a narrow range around a fixed price reflects a “volatility compression” phase that often precedes an explosive breakout.

For this reason, SOL derivatives traders may soon face liquidation regardless of whether they hold Long or Short positions. Analyst Joao Wedson’s observation of the Solana Buy/Sell Pressure Delta index reinforces this possibility.

The Solana Buy/Sell Pressure Delta indicator has turned red and declined sharply. He explained that historically, this signal does not necessarily indicate further downside. However, it may mark a major bottom before a reversal.

“Historically, this has signaled two possible scenarios: a local bottom followed by a strong upside move, or the beginning of a strong bear market, like what we saw in 2022,” Joao Wedson predicted.

Solana Buy/Sell Pressure Delta. Source: Alphractal

The 7-day liquidation map from Coinglass shows that if SOL falls to $74 this week, cumulative potential liquidation volume for Long positions could reach $376 million.

SOL Exchange Liquidation Map. Source: Coinglass

Conversely, if SOL rebounds to $95, cumulative potential liquidation volume for Short positions could reach $450 million.

2. XRP

XRP is also facing a short-term balance between buying and selling pressure. Negative news about escalating tensions involving the United States, Israel, and Iran over the weekend did not trigger a sell-off. Instead, XRP held steady around $1.35.

A recent report by BeInCrypto stated that the Net Unrealized Profit and Loss (NUPL) indicator shows the final phase of a downtrend. Over the past 12 years, March has delivered an average return of 18% for XRP, making it the strongest month of the first quarter.

However, over the past week, 472 million XRP, worth $652 million, moved to Binance. Binance balances have shown signs of reversing into growth after months of decline.