Technical Notes｜$HYPE ｜$1.97 million in long liquidations
First, the definitions: A long position is liquidated when a leveraged position betting on prices rising is forcibly closed, generally when prices fall. Short positions are liquidated the other way around, most often during a rally.
The takeaway: The key to leveraged trading is that even if your prediction ultimately proves correct, price fluctuations along the way may wipe out your position prematurely.
Calculating your position size based on where you place your stop-loss is much more reliable than trading on gut instinct.
First, the definitions: A long position is liquidated when a leveraged position betting on prices rising is forcibly closed, generally when prices fall. Short positions are liquidated the other way around, most often during a rally.
The takeaway: The key to leveraged trading is that even if your prediction ultimately proves correct, price fluctuations along the way may wipe out your position prematurely.
Calculating your position size based on where you place your stop-loss is much more reliable than trading on gut instinct.
