Liquidation Skew vs Short Squeeze

The distribution of open positions by price level, showing where the largest concentrations of forced-close triggers are located relative to current price; large clusters above current price represent potential short squeeze fuel; large clusters below represent potential long cascade triggers.

A rapid price advance driven by the forced closing of short positions; rising price liquidates or prompts voluntary closing of short positions, both of which require buying that accelerates the advance; most likely when short positioning is crowded and large liquidation clusters exist above current price.