How do you use the long/short ratio? Take $BR as an example: the market-wide account long/short ratio is 1.08 (51.9% long / 48.1% short), compared with 0.98 an hour ago.
I usually look at it in three steps:
① Check for extremes: It’s not crowded right now, so its indicative value is limited;
② Check the change: Long positions have increased compared with an hour ago;
③ Check for divergence: The price is up 29.76% over 24 hours, with no obvious divergence for now.
Sentiment reflects what people are thinking; it doesn’t tell you where the market will go next.
#BR
I usually look at it in three steps:
① Check for extremes: It’s not crowded right now, so its indicative value is limited;
② Check the change: Long positions have increased compared with an hour ago;
③ Check for divergence: The price is up 29.76% over 24 hours, with no obvious divergence for now.
Sentiment reflects what people are thinking; it doesn’t tell you where the market will go next.
#BR