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New data reveals a deep division in the altcoin markets, signaling a high level of volatility
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AVAX, LINK and other groups face a “short squeeze” threat, which is a bullish set-up
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RUNE and DOGE are part of another group that faces a “long squeeze” threat, a bearish set-up
Crypto traders are increasingly shifting their focus away from traditional price movements to liquidation densities, a less-known but powerful metric which can provide early signals of significant price changes.
The latest data from analytics platform TheKingfisher shows a notable imbalance between short and longer liquidations across a number of major cryptocurrencies. These patterns may cause abrupt market movements when key price levels are tested.
Short Squeeze Watchlist for AVAX, LINK LTC and XLM
Four major altcoins show an extremely high risk of “short squeeze,” which is a market event in which a rising price forces traders to close their positions who bet against that asset, pushing up the price even faster.
- AVAX’s current price of $19.39 is up 0.33% over the last 24 hours, and 18.78% in the last week. This sharp rise in price and high liquidity density may force short positions close, pushing the prices even higher.
- Chainlink (LINK), which is also trading at $15.94 has gained 1.39% this morning and 17.90% in the past week. Its short-liquidation risk is 91.3%. A wave of short covering can quickly push momentum upward.
Related:4 Underrated U.S. Altcoins With Strong Fundamentals To Watch in 2025
- Litecoin, priced at $95.41, also showed a weekly gain of 10.30%. Despite a daily dip of only 0.66%, the 88.5% short liquidity density suggests that more upside is possible.
- Stellar (XLM), currently trading at $0.4548 has seen a 2.23% drop today, but has surged by 80.93% in the last seven days. This correction could only be temporary, if a squeeze occurs. 76.9% short positions are at risk.
Long Squeeze Checklist: RUNE AAVE and DOGE
On the other hand, some popular coins are at risk of a “long-squeeze” where a falling market forces leveraged long-term traders to sell and push the price even lower.
- THORChain’s (RUNE) risk for longs is 89%. Its current $1.55 price has risen 0.75% today, and 16.79% in the last week. These gains could be overstretched and a long squeeze may trigger a sharp drop.
Related to Discontinued Now, Dominant soon? RSR, ONDO LINK, AVAX, and Other RWA Tokens are gaining momentum
- Aave (AAVE), currently priced at $319.18 is up 2.48% this morning and 10.87% for the week. The coin is vulnerable to a decline in bullish momentum due to its 79.4% liquidation risk.
- Dogecoin, trading at $0.2003, also faces a long-term liquidation risk of 70.7%. Although Dogecoin (DOGE) has a weekly gain in excess of 18.82% its daily dip of 0.02% suggests a possible cooling.
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