How long does a correction in the currency circle usually last before positions are liquidated?

The duration of the correction in the currency circle varies, and is affected by market conditions, asset fluctuations and investor leverage. Usually, short corrections (1-3 days) will not lead to liquidation, medium corrections (3-10 days), medium-leverage investors face the risk of liquidation, and long corrections (more than 10 days), high-leverage investors are very likely to liquidate their positions. warehouse. The time point of liquidation depends on the leverage ratio and the value of the collateral. The higher the leverage ratio, the smaller the value of the collateral, and the greater the risk of liquidation. Investors need to use leverage with caution and adjust leverage ratios based on risk tolerance and market conditions.

How long does a currency correction usually last before it leads to liquidation?

The duration of currency corrections varies depending on market conditions, asset volatility and investor leverage. Based on historical data, the duration of the pullback is as follows:

Short pullback (1-3 days):

• Occurs when the market drops slightly, and investors with low leverage usually do not liquidate their positions.

Medium correction (3-10 days):

• occurs when the market drops significantly, and investors with medium leverage may face the risk of liquidation.

Long pullback (more than 10 days):

• occurs when the market continues to decline, and highly leveraged investors are very likely to liquidate their positions.

As for the timing of liquidation, it depends on the investor’s leverage level and the value of the collateral. The higher the leverage ratio, the smaller the value of the collateral, and the greater the risk of liquidation. For example:

• If an investor uses 10x leverage, the position will be liquidated when the asset price drops by 10%.
• If an investor uses 50x leverage, their position will be liquidated when the asset price drops by 2%.

Therefore, in order to avoid liquidation, investors should use leverage cautiously based on their risk tolerance and market conditions. When there is a market correction, it is recommended to reduce the leverage ratio or close the position with stop loss to protect the investment.

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