Binance Longs & Shorts
Indicators based on tracking longs and shorts on Binance exchange.
Binance provides 3 separate indicators that help identify long (and short) direction.
1) Global Longs & Shorts Accounts: This measures the total number of *accounts* that are long (or short) on Binance. So for example, if there are 1million accounts on Binance and 600k of them are net long, then the global accounts long% is 60% (and short% = 40%). Each account gets one "vote"
2) Top Trader Longs & Shorts Accounts: This measures the total number of *top trader accounts* that are long (or short) on Binance. Note, top traders do not necessarily mean the best traders or those with the highest profits, but rather Binance classifies top traders as accounts with the top20% in margin (or balance). This indicator is similar to Global Long Accounts with the only difference being that it focuses on the top 20% accounts.
3) Top Trader Longs & Shorts Positions: This measures the total number of *top trader positions* that are long (or short) on Binance. The key difference here is that instead of looking at accounts, it instead looks at positions. For example, let's say there are 10 accounts that make up top traders and these positions are the following:
| Trader | Side | Size |
|---|---|---|
1 | Long | 100k |
2 | Long | 200k |
3 | Long | 100k |
4 | Short | 500k |
5 | Long | 100k |
6 | Short | 1million |
7 | Long | 200k |
8 | Short | 500k |
9 | Long | 200k |
10 | Long | 100k |
So in total, we have 7 accounts that are long and 3 accounts that are short. This mean 70% of *accounts* are long. However, in terms of positions (or size), 1m positions are long and 2m positions are short, implying that 33% *positions* are long.
We use top trader positions as a proxy to whale positions and global accounts as a proxy to retail. Traders and researchers can use these indicators to understand where the majority of positions lie and how larger positions diverge or converge with the majority of accounts (retail). Combining these indicators with open interest can often explain a lot on how the market participants are positioning themselves.
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