BTCUSDT - Who is next to liquidate? Guess or Chess?
Hallo to all. Here, we present something we wanted to share publicly, since we started the development of the Liquidations Levels indicator, 1.5 year ago.
We think it is useful, because It has to do with the accuracy of the result and the indicator.
We compare what you might think it happened (when using the indicator) with the reality, what really really happened in the charts.
To be honest: The accuracy of the results was always a question inside our mind. If we couldn't validate the calculations in reality, then the indicator is useless or it might lead to misunderstanding or, worse, misinterpretation.
Some things first:
The indicator is trying to calculate the other traders large over-leveraged positions at the time they opened, plot them in the chart exactly when they opened and to track the pair Price Action (recaction) for these.
The Market Maker, is always, hunting these positions and is trying to create Max Pain for these type of positions, by hitting them, usually in bunches/groups of them, with wicks or aggressive moves.
Liq Levels calculations: In order to do the correct calculations, we were forced to make (like on every algorithm) some mini-assumptions about the calculations.
It's like the Fast Fourier Transform sampling (FTT) coming from the Signal Processing Theory, we have learned in Communications on University, many years ago.
The sampling, the interval, the period are extremely important parameters. Especially here, for each parameter, even a change of 0.01 percent will lead to different results. So we must be accurate.
So... The 1 million dollars question: Does the indicator shows real liquidations? Is the MM actually liquidate trades positions in the indicators levels we have calculate?
Can we trust the indicator in the Trading View?
The answer is YES. It is a 100% validation.
After a long time, we have finally managed to plot all the real time liquidations that happened in Binance Futures pairs, directly in the chart. These data are collected by the official feed from the Binance API.
So, every green "X" you see in the following chart, is a single liquidation of a Long Position and every red "X" is the liquidation of a Short Position. On the same chart there are also plotted the Liquidation levels indicator with their lines. I think the chart speaks for it self.
Where the liquidation levels plot a line, and when the price went there finally, there exactly, the liquidations happened.
The validation of Liquidation Levels with the real liquidations:
If someone asks me, about what will be the next move, I will answer to him/her with something else:
Noone knows (except the MM), but with the use of the liquidation levels indicator, you can help yourself, and transform your trading style, from a Guess game, to a Chess game. Use your mind, evaluate the situation, and think like the MM.
What you will do next?
This will be another story to analyze.
Best regards to all,
the Mobility in Life Applications TEAM
(developers of the Liquidations Levels indicator)
We think it is useful, because It has to do with the accuracy of the result and the indicator.
We compare what you might think it happened (when using the indicator) with the reality, what really really happened in the charts.
To be honest: The accuracy of the results was always a question inside our mind. If we couldn't validate the calculations in reality, then the indicator is useless or it might lead to misunderstanding or, worse, misinterpretation.
Some things first:
The indicator is trying to calculate the other traders large over-leveraged positions at the time they opened, plot them in the chart exactly when they opened and to track the pair Price Action (recaction) for these.
The Market Maker, is always, hunting these positions and is trying to create Max Pain for these type of positions, by hitting them, usually in bunches/groups of them, with wicks or aggressive moves.
Liq Levels calculations: In order to do the correct calculations, we were forced to make (like on every algorithm) some mini-assumptions about the calculations.
It's like the Fast Fourier Transform sampling (FTT) coming from the Signal Processing Theory, we have learned in Communications on University, many years ago.
The sampling, the interval, the period are extremely important parameters. Especially here, for each parameter, even a change of 0.01 percent will lead to different results. So we must be accurate.
So... The 1 million dollars question: Does the indicator shows real liquidations? Is the MM actually liquidate trades positions in the indicators levels we have calculate?
Can we trust the indicator in the Trading View?
The answer is YES. It is a 100% validation.
After a long time, we have finally managed to plot all the real time liquidations that happened in Binance Futures pairs, directly in the chart. These data are collected by the official feed from the Binance API.
So, every green "X" you see in the following chart, is a single liquidation of a Long Position and every red "X" is the liquidation of a Short Position. On the same chart there are also plotted the Liquidation levels indicator with their lines. I think the chart speaks for it self.
Where the liquidation levels plot a line, and when the price went there finally, there exactly, the liquidations happened.
The validation of Liquidation Levels with the real liquidations:
If someone asks me, about what will be the next move, I will answer to him/her with something else:
Noone knows (except the MM), but with the use of the liquidation levels indicator, you can help yourself, and transform your trading style, from a Guess game, to a Chess game. Use your mind, evaluate the situation, and think like the MM.
What you will do next?
This will be another story to analyze.
Best regards to all,
the Mobility in Life Applications TEAM
(developers of the Liquidations Levels indicator)