If Bitcoin’s price goes above $80,000, the total amount of short-term liquidations on major exchanges will reach $170 million. On the other hand, if it falls below $78,000, the total amount of long-term liquidations will reach $240 million. These figures do not show the exact number or value of contracts being liquidated, but the size of the liquidation bars on the chart indicates the strength of each cluster compared to the others.
This means that the chart can predict how strong the price reaction will be when a certain level is reached. The larger the liquidation bar, the more impact the price will have on the liquidity wave.
