I have seen many times how the price skyrockets or crashes within seconds without any news to justify it. Most of the time, behind these violent movements, there is something called a squeeze — whether a short squeeze or a long squeeze.

Let's start with the short squeeze, which is probably the most spectacular. Imagine there are a bunch of traders betting that the price will fall, all in short. But suddenly, the price starts to rise. What happens then? Those in short panic and need to close their positions by buying. This creates a cascade of forced buys that pushes the price even higher. It's like a domino effect where each position closure fuels the next upward move. The result is that brutal pump you see on the charts.

Now, the long squeeze is exactly the opposite but just as brutal. When too many people are long expecting the price to go up, but suddenly it drops sharply, long traders are forced to rush out of their positions. Each sale generates more panic, each close forces more sales. It's a chain collapse. A long squeeze is what you see when the market simply collapses mercilessly.

The interesting thing is that both squeezes have patterns you can detect before they happen. Look at open interest — if it's very high and funding rates are heavily skewed to one side, it means there is a lot of accumulated pressure. Then watch the volume. When you see a sudden spike in volume in the opposite direction of where the market was heading, that’s a sign that something is about to break. And finally, pay attention to support and resistance levels. When the price breaks one of these key levels violently, especially with volume, it’s likely that a squeeze is underway.

My advice after seeing this a thousand times: don’t panic and chase those giant candles. Squeezes punish those who enter late. What works is observing how the market accumulates pressure, identifying where the breakout point is, and then trading once the initial move has calmed down. That’s when you get the best entry and less risk. Squeezes are opportunities, but only if you know where to position yourself.