Have you ever heard of Liquidation HeatMap?

🌐 In a nutshell, it predicts the price levels at which massive liquidation events can occur. But what is liquidation? This is when a trader's positions are closed due to price fluctuations, and the account balance is not enough to cover the open positions.

💡 How can this help you? By understanding the liquidation levels of other traders, you can gain an advantage similar to understanding order book liquidity. Coinglass' Liquidation HeatMap attempts to predict where significant liquidations will occur to help traders find the best liquidity positions.

🌈 How does it work? The map calculates liquidation levels based on market data and different leverages. As more clearance levels are added at a specific price, the colors on the map change. The color range goes from purple to yellow, indicating a high amount of predicted liquidation levels.

📈 How to use? The settlement map allows you to identify areas of high liquidity, useful in several ways:

1 - Magnetic Zone: Concentration of potential liquidation levels in a price range may indicate that the price is likely to move into that zone

2 - Support/Resistance Zone: In areas of high liquidity, large traders ("whales") can execute trades quickly at favorable prices, influencing the price direction.

🔍 Settlement plays a crucial role in the cryptocurrency market, impacting traders' positions. Understanding how to use the settlement map can help you make informed decisions and increase your chances of success.

https://www.coinglass.com/pt/pro/futures/LiquidationHeatMapNew

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