Dogecoin’s trading activity surprised investors, as a 6% price rise led to a staggering 400% imbalance in short-term liquidations, totaling $7.96 million. The data highlights growing bullish sentiment despite market risks, as crypto rebounds catch traders off guard.
Dogecoin faces unusual trading activity
Dogecoin (DOGE), the leader of the meme cryptocurrency market, has seen some unusual trading activity recently.
More precisely, as reported CoinGlassa massive imbalance occurred in liquidations of DOGE perpetual futures positions, with the number of short positions exceeding the number of long positions by 400%.
So, if all Dogecoin holdings were liquidated for $9.94 million, there would be $1.98 million in long positions and $7.96 million in short positions. The fact that the price of Dogecoin increased by 6% in a single day explains the disparity.
Massive Short-Term Liquidations as Dogecoin Defies Expectations
It turns out that many were pessimistic about the popular coin’s ability to cause such a surge, and they were betting against it, U.Today actions
There is a general trend in the market that short positions experience more difficulty than long positions; it is not exclusive to DOGE; Of the $201.55 million liquidated in 24 hours, $139.74 million were short positions, while $61.81 million were long positions.
Volatility Creates Risks in Perpetual Futures Trading
This proves that trading cryptocurrencies, especially perpetual futures, is currently dangerous, likely due to unexpected price rises and rebounds. Since the market could change unexpectedly, leading to significant losses for traders, they should exercise caution as the new year begins.
There are still not many buyers in the market as most people are having fun on weekends and not paying attention to digital asset charts.
On the other hand, it is evident that, at least for now, the majority of market participants continue to bet on a bull market. Given the events of November, it is reasonable to assume that January will bring more of the same.