Understanding Crypto Liquidations
Liquidations occur when an exchange forcibly closes a leveraged position because the account can no longer cover the required margin. At 10x leverage, a 10% adverse move causes liquidation. At 50x, just 2% is enough.
Why Liquidation Events Matter
- Cascade liquidations — A price drop triggers liquidations, forcing more selling, driving prices lower in a self-reinforcing loop
- Market reversals — Massive liquidation spikes often signal exhaustion of one side, preceding sharp reversals
- Liquidity zones — Large liquidation clusters create predictable support/resistance levels
Key Metrics
- Long vs. Short ratio — Reveals which side is being systematically wiped out
- Liquidation size — Larger events have greater market impact
- Frequency trends — Increasing frequency signals rising leverage and fragility
The StratBase.ai REKT Screener provides a real-time liquidation feed from Binance and Bybit, with aggregate statistics, Telegram alerts for large events, and historical data for pattern analysis.
