A quick note: During this round of volatility in the $BTC perpetual contract, a $2.8 million long position was liquidated.
People often ask how to interpret liquidations, so here’s my take.
When a long position is liquidated, the system sells at market price to close it; when a short position is liquidated, the system buys back at market price to close it.
Liquidation data can show which way contract positions are more crowded, but it’s backward-looking data and can’t be used directly to predict price movements.
Don’t change your original approach based on a single indicator, and don’t use borrowed money to test what a reading means.
#BTC
Just a casual note—decide for yourself what to do.
People often ask how to interpret liquidations, so here’s my take.
When a long position is liquidated, the system sells at market price to close it; when a short position is liquidated, the system buys back at market price to close it.
Liquidation data can show which way contract positions are more crowded, but it’s backward-looking data and can’t be used directly to predict price movements.
Don’t change your original approach based on a single indicator, and don’t use borrowed money to test what a reading means.
#BTC
Just a casual note—decide for yourself what to do.
