Binance futures liquidations totaled about $2.2 million in the past hour. Long positions accounted for 9.4%, and the largest liquidation was $ZEC ($690,000).
I used to feel alarmed whenever I saw liquidation figures, but gradually I came to understand: when liquidations are dominated by long positions, they usually happen during a downturn; when short positions account for most liquidations, it usually happens during a rally. These figures show liquidations over the past period—they don’t predict what comes next.
Large liquidations mean leverage on that side has been flushed out. Some people think volatility may temporarily calm down afterward, but that’s no hard-and-fast rule.
Unusually large figures often come with more violent volatility. At times like this, it’s better to dial back leverage rather than make a big bet.
I used to feel alarmed whenever I saw liquidation figures, but gradually I came to understand: when liquidations are dominated by long positions, they usually happen during a downturn; when short positions account for most liquidations, it usually happens during a rally. These figures show liquidations over the past period—they don’t predict what comes next.
Large liquidations mean leverage on that side has been flushed out. Some people think volatility may temporarily calm down afterward, but that’s no hard-and-fast rule.
Unusually large figures often come with more violent volatility. At times like this, it’s better to dial back leverage rather than make a big bet.
