A quick note: Binance futures liquidations totaled around $4.82 million over the past hour, with long positions accounting for 89.9%. The largest liquidation was $ETH .
People often ask what liquidation means. Here’s how I understand it.
Liquidation (commonly called getting rekt) means the system automatically closes a leveraged position when losses eat into the margin until it falls below the maintenance margin requirement.
A “long squeeze” happens when a price drop triggers liquidations of long positions, and the resulting sell orders push prices even lower. A “short squeeze” is when a price rise forces short positions to be liquidated, and buybacks push prices even higher.
Before opening a leveraged position, first work out whether you can withstand the worst-case outcome, then consider what the signals are saying.
People often ask what liquidation means. Here’s how I understand it.
Liquidation (commonly called getting rekt) means the system automatically closes a leveraged position when losses eat into the margin until it falls below the maintenance margin requirement.
A “long squeeze” happens when a price drop triggers liquidations of long positions, and the resulting sell orders push prices even lower. A “short squeeze” is when a price rise forces short positions to be liquidated, and buybacks push prices even higher.
Before opening a leveraged position, first work out whether you can withstand the worst-case outcome, then consider what the signals are saying.
