How do these sudden CRYPTO crashes happen?! 🤯📉🚨
STOP listening to chickens 🐔 copying the first chicken who yells, “We’ve been scammed! It was all a setup!” Blah blah blah…
What causes these sudden PRICE DROPS? Why do we get days like this? 🤔 For a long time, prices move up and down calmly, then BOOM! 🚀💥 A massive cascade of red candles! 🔻
Let me break it down for you:
It’s all about LIQUIDATIONS! And in this case, cascade liquidations.
🔍 When the market is overexposed in one direction (usually LONG positions) and there’s too much leverage, things get… risky.
Here’s what happens:
1️⃣ The market rises steadily, and some early investors lock in profits—they SELL.
2️⃣ This selling pressure pushes prices down. 📉
3️⃣ If there’s excessive leverage, this initial drop triggers liquidations for those holding leveraged long positions.
4️⃣ These liquidations force more selling, causing prices to plunge even further.
5️⃣ And guess what? This triggers more liquidations. A vicious cycle begins—BAM! Cascading liquidations.
In short, it’s a chain reaction caused by greed, leverage, and the market correcting itself.
Stay sharp, don’t get caught in the wave! 🌊⚠️ Always manage your risk. 🔐
