Reviewing the big dump from the perspective of contract data in the morning

Reviewing the big dump from the perspective of contract data in the morning

At around 05:00 this morning, the encryption currency market experienced a sharp decline across the board,

In addition to $BTC and $ETH showing higher resistance to decline,

The situation of Shanzhai Coin is not so optimistic.

There is a saying, "Real big money is actually lost in the bull run."

This is because the bullish sentiment is high, and the leverage usage is higher, leading to higher volatility.

Because the contract Position has the mechanism of Forced Liquidation, it amplifies during Fluctuation and leads to liquidation at the same time,

Price will trigger a chain reaction due to liquidation, thereby accelerating upward or downward movement.

Let's review some data during this downturn:

As shown in the above figure, a significant amount of Get Liquidated data can be seen.

Nearly $600 million long positions were liquidated in those few minutes.

When these Positions Get Liquidated, they actually make a 'sell' action.

Therefore, it will further accelerate the downward speed.

Let's take a look at the funding rate:

High funding rates usually indicate high market sentiment, even overheating,

The sharp drop this morning also gradually caused the funding rate to drop in the follow-up period.

Although a high capital fee rate does not necessarily lead to liquidation, it does provide an environment that is more likely to be liquidated.

Finally, although Bull Market is full of opportunities, it is not uncommon to use leverage to amplify profits.

But as mentioned earlier, Bull Market often comes with high Fluctuation, and if you don't have good risk control, you may very likely end up losing more than gaining!