🔥 Predictive Liquidations: How Does It Work? 🔥

In the derivatives market, traders can open leveraged positions (margin trades). Every such position has a liquidation price—a specific level of the underlying asset at which the exchange will forcibly close the margin position. This is done to prevent the trader’s losses from exceeding their deposit.

📌 Why is it important to identify mass liquidation levels?

Individual liquidations rarely impact the market. However, when there are clusters of liquidation orders (margin zones), they can trigger sharp price moves and spikes in volatility. These zones become powerful catalysts for market movements.

📌 How are margin zones determined?

Regular users can’t see the exact data on margin zones—this information is only available to exchanges and their partners. However, modern analytics platforms can accurately estimate and visualize these zones. In our work, we use REINFORCED CONCRETE, but you can choose whichever tool suits you best.

📌 How can you use this information?

✅ Identify mass liquidation zones in advance.
✅ Enter trades before the price reaches these levels.
✅ Use these zones to set more effective stop-losses and take-profits.

❗️ By applying predictive liquidation analysis, traders can significantly improve their results by understanding where the key market moves are likely to happen ahead of time.