DatCryptoBoi

Why its dangerous to go "All In"

Education
BITFINEX:EOSUSDLONGS   EOSUSD Longs
Recent sentiment on EOS was so bullish that longs reached a pretty ridiculous level.

Easy to spot in hindsight but the max pain was to the downside.

Max pain thoery. The market will move to rekt the most amount of people it can. In options trading max pain is the $ value of the stock where options expire worthless. Markets often gravitate towards max pain on options expiry day.

So for leveraged longs they were in the max pain zone. The dump was very sharp due to longs being stopped out + liquidity crisis. This doesn't mean the overall price on EOS is bearish , just that the traders got too bullish .

With a bit of luck shorters will start opening too many shorts and max pain will be to theupside ;)

Keep watching Longs vs. Shorts on your favourite pairs to gauge sentiment. Trade opposite when sentiment extreme is found.