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What does long liquidation mean?

Updated: 9/16/2023
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14y ago

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This term has origins in Futures markets. It means that the people who hold long future positions are selling their inventory. For example, if you bought 100 shares of Apple Inc (AAPL) , you are considered long in AAPL. When you sell your 100 shares of AAPL, you are long liquidating your position. Long liquidation is considered as old business.

If you are initiating a short position by selling something first, this is considered as new business.

Differentiating old business and new business is very important for the survival of a trader

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