Overview
Liquidations displays forced closures of leveraged positions. When a trader’s margin falls below the maintenance requirement, the exchange forcibly closes their position at market price. This indicator tracks these events, separated by direction (long liquidations vs. short liquidations). Liquidations represent involuntary, often large market orders that can accelerate price moves and create cascading effects.How It Works
The indicator collects liquidation events from the exchange’s real-time feed and aggregates them per bar. Each liquidation is classified as either a long liquidation (buyer forced out) or a short liquidation (seller forced out). Two display modes are available:- Volume mode: Shows the dollar value of liquidated positions.
- Count mode: Shows the number of liquidation events.
Chart Type
| Property | Value |
|---|---|
| Type | Subchart |
| Position | Below main chart |
| Data source | Exchange liquidation feed |
Settings
| Parameter | Description | Default |
|---|---|---|
| longColor | Color for long liquidations | #22c55e |
| shortColor | Color for short liquidations | #ef4444 |
| mode | Display metric | volume |
| minValue | Minimum value filter (hides small liquidations) | 0 |
| displayMode | Rendering style | columns |
| highlightAnomalies | Flag statistical outliers | false |
| anomalyThreshold | Standard deviation multiplier | 2.5 |
| anomalyPeriod | Lookback period for anomaly stats | 30 |
| gradientIntensity | Fill gradient strength (0-1) | 0 |
Mode Options
| Mode | Description |
|---|---|
volume | Total USD value of liquidated positions. Shows the magnitude of forced selling/buying. |
count | Number of liquidation events. Shows how many traders were affected. |
Interpretation
Liquidation Cascades
When price moves sharply, it triggers liquidations at the nearest leverage tier. Those forced market orders push price further, triggering the next tier of liquidations, creating a cascade effect.Reading Liquidation Direction
| Liquidation Type | What Happened | Price Impact |
|---|---|---|
| Long liquidations | Longs forced to sell | Accelerates price drops |
| Short liquidations | Shorts forced to buy | Accelerates price rallies |
Volume vs. Count
- High volume, low count: A few large positions were liquidated — likely institutional or whale liquidations.
- Low volume, high count: Many small positions were liquidated — retail leverage washout.
- High volume, high count: Broad-based liquidation event — significant market stress.
Anomaly Detection
When enabled, bars where liquidation volume or count exceeds the rolling average by more than the configured threshold are flagged. These represent unusually large liquidation events.Practical Examples
- Cascade bottom: Price drops sharply with massive long liquidation spike, then stabilizes — forced selling is exhausted, potential reversal.
- Squeeze confirmation: Price rallies with large short liquidation volume — shorts being forced out, fueling the move higher.
- Quiet period: Low liquidation activity during consolidation — positions are not under stress, breakout hasn’t triggered yet.
Use the
minValue filter to hide small liquidations and focus on significant events. This reduces noise on lower timeframes.Related Indicators
- Liquidation Map — heatmap of estimated liquidation zones
- Liquidation Levels — specific price levels by leverage tier
- Open Interest — liquidations reduce OI
- Funding Rate — extreme funding often precedes liquidations