#CryptoMarketDip In moments of massive liquidations, the market tends to generate rapid and extreme movements. This creates opportunities for attentive traders who know how to identify patterns and act with precision. Here I explain how to take advantage of the momentum in these scenarios:
1. Identify Liquidation Patterns
When massive liquidations occur, the market often shows characteristic behaviors that you can exploit:
• Sweeping Candles: Rapid downward movements that break key supports, followed by an immediate rebound.
• Anomalous Volume: A significant increase in volume can indicate liquidations and a possible end to the forced selling.
• Oversold in Indicators: Oscillators like the RSI (Relative Strength Index) often show extreme readings (<20) at these times.