Liq Short (Short Liquidations) → Short (Fade / Squeeze Exhaustion)
Setup Idea
This is a disciplined “post-squeeze” short. Short liquidations are forced buy orders that often push price sharply higher near the end of a move. In practice, these spikes frequently occur at highs or during the final phase of an impulse.
Our job is not to fight the squeeze. We wait until it’s clearly exhausted, then trade the pullback/normalization.
The key principle: don’t short the first green candle and don’t short “by feeling.” Entry is allowed only after proof that the rally has burned out: structure breaks, Premium stops accelerating, and price fails to hold key levels/VWAP.
What You Need on TradingView
Conditions (Checklist)
Required
- Your screener triggers a Liq Short spike (e.g., >$20k as a “strong” trigger)
- Premium Index is high and stops rising (ideal: stabilizes or turns down)
- Price shows exhaustion:
Optional (Improves Quality)
- RSI14 was overbought and starts rolling over
- OI stops accelerating upward (or starts declining) — squeeze fuel is running out
- Volume fades after the liquidation spike (another exhaustion signal)
How to Enter Manually
Beginner rule: short only after exhaustion, and only on a pullback.
- on the pullback up after the first push down (i.e., not on the first red candle)
- ideally, the pullback stalls and rejects (a weak attempt to continue higher)
Invalidation (When the Setup Breaks)
To keep risk real, you need a strict manual exit rule:
- Price makes a new squeeze high (or a new pullback high)
- Premium Index starts accelerating upward again (overheat is not finished)
- Price holds above VWAP (2–3 consecutive 1m closes) and remains there
Take Profit (Short Targets, Matching Your Model)
Time Stop
If there’s no continuation lower within 20–40 minutes, exit. This is an “exhaustion” trade, not a hold.
Common Beginner Mistakes
- Shorting right at the Liq Short spike (getting caught in continued squeeze)
- Ignoring Premium: while it’s accelerating upward, the short is toxic
- Entering without structure (no lower high / no break)
- Holding while price reclaims VWAP and stays above it
30-Second Quick Checklist
- Liq Short spike ✅
- Premium is high and stopped rising ✅
- LH / micro-structure break ✅
- Entry on a pullback (not the first red candle) ✅
- VWAP is not being held to the upside ✅
If any item is missing — skip the trade.
Funding Role (What’s OK vs. What’s Not)
For this short, funding is not a “signal.” It’s a squeeze-risk filter.
OK for a Short
- Funding is near zero
- Funding is positive (longs pay shorts) — often confirms long-side overcrowding at highs, making the setup cleaner
Caution
- Funding is slightly negative, but Premium is already turning down and structure has broken — possible, but only with strict invalidation discipline
Not Recommended for a Short (Your “Golden Funding” Trap)
- Funding is strongly negative, especially if it settles hourly (the “golden” regime where shorts pay longs).
In this environment, you can easily get hit by a second squeeze wave, because the market has extra fuel against your position. The correct action is not to short. Wait for a regime shift: funding weakens toward 0, Premium stops accelerating, and OI starts declining.
Execution Examples
Important
This setup works worse when the market is in a strong overall uptrend and squeezes happen in series. In those phases, the squeeze-exhaustion short must be extremely disciplined: only after exhaustion, short time stop, no bag-holding.
Where to Find These Screeners
Trading and setup-finding screeners are available on crypto-resources.com — a working tool built for systematic trading, not just “watching signals.”
The key difference versus public screeners is deep filtering and flexible configuration (volume, coin age, whitelist/blacklist, funding ranges, etc.), plus one-click execution directly from the screener page.
With unfiltered public signals, the workflow looks very different: you get a stream of raw noise, manually verify data across multiple platforms, bounce between charts and a terminal, and ultimately lose the most valuable things — time and focus.
Very quickly, trading turns into low-efficiency busywork: signals arrive late, the best entries disappear, and instead of following a system, you spend your session endlessly “processing alerts.”