Source: https://mochatrade.com/learn/glossary/liquidation-cascade

# Liquidation cascade
URL: https://mochatrade.com/learn/glossary/liquidation-cascade
Last modified: 2026-10-17

A liquidation cascade is a chain of forced closes: traders with similar entries and leverage have liquidation prices a few dollars apart, the first one sells at market, that pushes the price into the next, and so on. Because those levels are known in advance, [the cluster becomes a magnet](https://mochatrade.com/blog/mocha-markets-weekly-019); a $2.74 billion night of short liquidations is the other direction. [Liquidation on Mochatrade](https://mochatrade.com/support/how-leverage-and-margin-work-on-mochatrade).

## Related terms

- Liquidation / forced square-off: https://mochatrade.com/learn/glossary/liquidation-forced-square-off
- Margin call: https://mochatrade.com/learn/glossary/margin-call
- Leverage in trading: https://mochatrade.com/learn/glossary/leverage-in-trading
- Leverage ratio: https://mochatrade.com/learn/glossary/leverage-ratio
- Liquidation price: https://mochatrade.com/learn/glossary/liquidation-price
- Stop-loss order: https://mochatrade.com/learn/glossary/stop-loss-order

Educational content only. Not investment advice. Leveraged products magnify losses as well as gains.