Bitcoin BTC Long Positions Face Enormous Liquidation Risk

CoinWorld reported:
Original source: Crypto A Yao



Currently, the long positions being liquidated on mainstream exchanges in the cryptocurrency market are significantly higher than the short positions against Bitcoin. According to data from Coinglass, if the price of Bitcoin falls below $62,000, the total amount of long position liquidations could reach $1.819 billion. Conversely, if the price of Bitcoin exceeds $66,000, the total amount of short position liquidations could reach $1.005 billion.
High Risk of Long Position Liquidations
In the cryptocurrency market, liquidations of long positions typically occur during price declines. Current data indicates that if Bitcoin falls below $62,000, long positions on mainstream centralized exchanges will face significant liquidation pressure, with a total at risk estimated at $1.819 billion. Such a wave of liquidations could prompt a swift market reaction, potentially leading to further price declines.



On the other hand, if Bitcoin rises, short positions could also face similar risks. If the price exceeds $66,000, approximately $1.005 billion worth of short positions could be liquidated, increasing the risk of losses for short positions and potentially driving prices even higher.
Concentration of Liquidations and Its Impact on Prices
The concentration of liquidations reflects the intensity of expected liquidations at specific price levels. According to Coinglass data, this concentration provides important insights into how the market may react when these price levels are reached. High liquidation clusters may indicate that the market could experience greater volatility when prices reach these thresholds.
Thus, fluctuations in Bitcoin’s price, whether rising or falling, could result in stronger price movements due to liquidation effects. In such market conditions, investors need to exercise caution when using leverage and manage their positions to mitigate liquidation risks. The clusters in the liquidation chart emphasize the significance and intensity of liquidations at specific levels, making them key indicators for predicting future market directions and making strategic decisions.