Liquidation Level
A liquidation level is a price area where one or more leveraged positions are estimated or known to become vulnerable to liquidation. When used by market data tools, these levels are often estimates derived from available market information rather than exact knowledge of every trader's position.
Why it matters to you
Areas containing substantial estimated liquidation exposure can become important because reaching them may trigger forced position closures. But a liquidation level should not be treated as a guaranteed price target.
Terms that sit next to this one
See the perpetuals front
The tools, the live market and the course.