How do you use the long/short ratio? Let’s use $ETH as an example: the global account long/short ratio is 3.92 (long 79.7% / short 20.3%) (3.84 one hour ago).
I usually look at it in three steps:
① Check for extremes: It’s already quite extreme, and the heavily crowded side is more vulnerable to getting caught in a reversal;
② Check the change: More traders are going long than one hour ago;
③ Check for divergence: Price is down 2.32% over 24h, but more traders are going long as the price falls—watch out for a long squeeze.
The data is for reference only, not a steering wheel.
#ETH
I usually look at it in three steps:
① Check for extremes: It’s already quite extreme, and the heavily crowded side is more vulnerable to getting caught in a reversal;
② Check the change: More traders are going long than one hour ago;
③ Check for divergence: Price is down 2.32% over 24h, but more traders are going long as the price falls—watch out for a long squeeze.
The data is for reference only, not a steering wheel.
#ETH
