# Liquidation

Forced closure of a leveraged position when its margin is exhausted.

Source: https://bykaranteli.com/glossary/liquidation · attribute to ByKaranteli and quote the timestamp.

## Definition

When a leveraged position's loss approaches the trader's margin, the exchange auto-closes it to protect itself and any insurance fund. Long liquidations happen as price falls; short liquidations happen as price rises. Traders commonly read clustered liquidation levels as places where forced selling or buying would add to a move if price reached them; that is a reading, not a forecast. We publish a live LiqMap showing the aggregate liquidation pressure by price level and a calculator that tells you exactly where your own position gets liquidated.

## Related

- https://bykaranteli.com/liqmap
- https://bykaranteli.com/tools/liq-calc
- https://bykaranteli.com/tools/position-size
- https://bykaranteli.com/glossary

Everything in one fetch: https://bykaranteli.com/llms-full.txt