It sounds like you are entering the password at an early stage and then the OS is not loading - that's what makes me think that FileVault is likely enabled.
You should be able to boot the macbook from a Parted Magic CD or flash drive and get an image onto an external USB drive with ddrescue (great guide by Silverleaf here: https://www.technibble.com/forums/resources/advanced-guide-to-ddrescue.10/ ). I always create an image and restore an image to a third drive to save myself from the stress of wondering if I set the clone in the right direction.
Are you dealing with a regular SATA drive here? If so, you can just use something basic like this: https://www.startech.com/ca/HDD/Adapters/USB-3-SATA-adapter-cable-with-UASP~USB3S2SAT3CB
or this: https://www.startech.com/HDD/Dockin...rive-Docking-Station-for-25-35-HDD~SATDOCKU3S
I had no idea that you could boot a Mac from Parted Magic. I've purchased the latest version and am now running ddrescue. Unfortunately, this SSD is NOT your usual SATA drive so I can't use the docking station that I have. It's an M.2 form factor I think, but I'm not 100% sure about that as the "notch" is in a different place than what I see when I look at the M.2 article on Wikipedia
I use that ddrescue article as my "bible" when doing data recovery. Wonderful article! Unfortunately, the 'lslbk' command provided in the article to inform you about what drives are there does not work in Parted Magic, but I was able to determine what the drive identifier was by using gSmartControl.
Thanks for responding!
Harry Z