Abnormal Activity in the Dogecoin Market
Unusual activity has been observed in the Dogecoin (DOGE) market. According to data from CoinGlass, derivative trading of this popular meme cryptocurrency showed a significant imbalance in liquidations during the 24 hours of December 18. The total value of liquidated positions amounted to $13.88 million. While this is not a significant portion of the overall $402.63 million across the crypto market, Dogecoin stood out as one of the most notable assets based on this metric.
Imbalance in Liquidated Positions
What’s striking is not just the total liquidation value but the structure of these liquidations. A staggering 92.36% of the liquidations were long positions. To put this into perspective, liquidated long positions exceeded short positions by 1,209%.
The primary reason behind this imbalance lies in a common trading mistake: poor risk management and excessive leverage. Traders arriving late to the rally or overextending their positions were caught off guard by volatility, leading to margin calls and eventual liquidations.
What Triggered the Massive Liquidations?
On December 18, Dogecoin appeared to be gearing up for a major price pump. The chart showed a pattern of lower highs and higher lows, often a precursor to an upward breakout.
Adding to this optimism was Bitcoin (BTC), which reached its all-time high at the same time. Dogecoin, which often mirrors Bitcoin’s price movements, looked promising on the chart, giving bulls reason to expect a breakout.
Major Sell-Off Shattered Expectations
The hopeful scenario was disrupted by a massive sell-off at the start of the next trading session, which dragged down DOGE’s price and liquidated a large number of long positions. A subsequent short-term rebound saw Dogecoin’s price rise by 1.5%, but this bounce was short-lived, leading to yet another wave of bullish liquidations.
What’s Net?
Bullish traders have been punished, while bearish traders are celebrating. The big question remains: how long will this trend continue? Will the market stabilize, or will further volatility catch traders off guard? Moving forward, traders must manage risk more carefully to avoid significant liquidations like those seen during this period.
#doge⚡ , #memecoin🚀🚀🚀 , #DogecoinCommunity , #CryptoNewss , #MemeWatch2024
Stay one step ahead – follow our profile and stay informed about everything important in the world of cryptocurrencies!
Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“