Long Short Balance represents the relative proportion of open long positions compared to open short positions within a cryptocurrency derivatives market. This metric serves as an indicator of prevailing market sentiment among traders. It reflects directional biases.
Context
Traders and analysts closely monitor the long short balance in perpetual futures and other derivatives markets to gauge the predominant market sentiment. A notable imbalance can suggest the potential for a price squeeze or a shift in market direction. This makes it a frequently cited indicator in cryptocurrency news for predicting short-term price movements.
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