Why traders should be careful about these 3 Altcoins
The altcoin market enters the second week of January with unclear signs. Some brands have reached new all-time highs. Others recovered in doubt. Most altcoins continue to struggle to recover from the heavy selloff that occurred in October last year.
In that context, three altcoins face a huge liquidity risk as traders may misjudge true market demand.
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1. Solana (Sun)
The beginning of 2026 Mem-Coin wave is not very strong, but it indicates that traders are risk-averse. Solana Ecosystem has set many new records. Pump.fun's DEX volume has reached a new all-time high. The number of meme tokens deployed daily has also increased.
As a result, many traders expect SOL to increase in the rest of January. This optimism is reflected in the liquidity data, where potential cumulative liquidity in long positions is much greater than that in short positions.
However, traders may be overestimating this demand. According to Sentiment data, the number of new wallets created every week reached 30.2 million in November 2024. This figure is now down to 7.3 million.
As the chart shows, the SOL rally is strongly correlated with weekly new wallet growth. A significant decline in this measure undermines the fundamental basis of the first-year rebound.
“Solana rose to $144 when it tried to break through the resistance of $145. The growth of the SOL network, which is largely dependent on this, may begin to increase again,” reports Sentiment.
A recent BeenCrypt report also indicated that as SOL recovered, institutional capital was flowing into the ecosystem. However, retail investors are largely absent. This group has been an important driver of SOL blast demonstrations in the past.
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If long traders continue to chase positions without strict stop-loss plans, they could face nearly $1 billion in liquidity. This will happen if SOL returns to around $132 this week.
2. Monero (XMR)
Discussions about Monero (XMR) in the crypto community have become more positive than ever. XMR set a new all-time high today. At the same time, as confidence weakened, rival Zcash (ZEC) fell sharply.
A seven-day fluid temperature map shows that potential cumulative fluids in long positions dominate those in short positions. XMR long traders should be cautious this week for two main reasons.
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First, XMR reached new highs touching the strong resistance trend that has been in place since 2018.
Second, Coinglass data shows that XMR open interest has risen to $180 million. This marks the highest level in history.
Traders are increasing capital when XMR reaches a higher resistance zone. This behavior is very dangerous. If XMR returns to $454 this week, long traders could face more than $20 million in liquidity.
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3. RENDER
RENDER is up more than 90% since the beginning of the year. Data from Artemis shows that not only RENDER, but other AI coins have also posted strong gains. This makes the AI sector the best performing segment of the crypto market this year.
Investors seem to be loving AI coins as early as 2026. This sentiment allows RENDER and other AI tokens to continue to increase after reaching a short-term balance.
“These AI coins are doing very well, and are rarely seen on the schedule anytime soon. FET and RENDER stand out. It seems logical to buy and hold a position, as the action doesn't seem to be over yet,” commented Altcoin Sherpa.
RENDER's seven-day liquidity chart shows relatively balanced prospects between long and short positions.
If AI coins continue to attract capital this week, RENDER short traders could face up to $5.8 million in liquidity. This happens if RENDER rises to $2.93.
