Long/Short Ratio

The Long/Short ratio is a critical indicator that shows which direction investors are positioning themselves in the cryptocurrency markets. It is calculated by comparing the total value of long and short positions opened in the futures market. This ratio is used to measure overall market sentiment and understand which direction investors have greater confidence in.

Formula:

If the ratio is high (for example, 70% long – 30% short), it indicates that the market is generally expecting upward movement. However, very high ratios can sometimes signal excessive optimism, which may increase the likelihood of a price correction. Conversely, if the ratio is low (for example, 30% long – 70% short), it suggests that investors are expecting a decline but it may also indicate a potential short squeeze, meaning a sudden upward price movement.

The BTC Long/Short Ratio table on this page shows a comparative view of position distributions across major exchanges such as Binance, OKX, Bybit, Bitfinex, BitMEX, Kraken, and Coinbase. Users can view both the total ratios and the monetary values of long/short positions. For example, while Binance may show a 54% long bias, Bybit may show a higher share of short positions, reflecting differing investor behavior across exchanges.

The Long/Short ratio does not provide definitive buy or sell signals on its own. The best practice is to evaluate this metric together with other analytical tools such as RSI, volume data, funding rates, and on-chain indicators. This combined approach makes it possible to predict market direction more reliably and minimize risks.