Sure, fundamentals and whales drive the big-picture price action in this market. Everyone knows that. But what drives short term swings and intermediate price action? Margin traders. I'm not the kind of degenerate that trades on leverage, but it sure helps to think like one.
Kommentera
⋅
If you couple this with a look at anticipated pressure from leveraged longs (solid lines), you get a more robust picture of where to expect support/resistance zones within the range:
Sorry i don't understand what you say, about that X. If you have time and want to explain... TY
reees
⋅
@MynameisTeo, it's just the amount of leverage you're shorting with, and the idea is that you want your liquidation point protected above some strong resistance. in this case, i would want my liquidation point protected above the ATH at 69k. so the levels on the chart just represent the threshold for safely shorting with X leverage and keeping your liquidation point protected. for example, the 2x level is at 34.5k, meaning if i were to 2x short below that level, my liquidation point would be below 69k. a 2x short anywhere above 34.5k keeps your liquidation safely above 69k.
MynameisTeo
⋅
@reees, I thought that was what you meant, but I was confused, because if I enter with 20X LIQ the price is 2k far from entry, with 10X - 5K from entry, and with 5 X - 10K far from entry. Ty for answer.
reees
⋅
@MynameisTeo, yeah i mean it depends entirely on your entry price. if X is your entry price, and N is your leverage multiplier, your liquidation point is X * (N / N-1).