Avoiding "Scam Wicks": Using the Markets Page for Safety
Summary
Scam wicks are violent price spikes from low liquidity where traders trigger stop-loss cascades. Avoid them on PERPTools by checking 24h Volume (avoid under $1M-$5M), verifying Order Book depth, and using Mark Price for liquidations instead of Last Price. Use non-round-number stops and lower leverage on altcoins.
In the high-leverage world of perpetuals, a "scam wick" is the ultimate trader’s nightmare. It occurs when a violent, localized price spike or "nosebleed" drop happens on a single exchange, often outside the asset's global trading range, only to return to previous levels within seconds. While the broader market remains stable, these wicks are often engineered by "liquidity hunters" to trigger a cascade of stop-losses and liquidations.
On PERPTools, protecting yourself from these anomalies starts at the Markets page. By understanding the relationship between liquidity and price stability, you can identify high-safety environments and avoid the "thin" markets where scam wicks thrive.
The Anatomy of a Scam Wick
Scam wicks are almost always a byproduct of low liquidity. In a "shallow" market, a single large order can sweep through the available buy or sell levels, causing an artificial price gap.
- Stop Hunting: Large players and algorithms identify "pockets" where retail traders cluster their stop-losses (often just below support or above resistance).
- The Cascade: By pushing the price into these zones, they trigger a chain reaction: one liquidation forces a market sell, which triggers the next liquidation, creating a "cascade" that forms the long, thin wick on your chart.
- The Snapback: Once the liquidity is "cleared," the price immediately reverts to the global average, leaving the over-leveraged trader with a closed position and a total loss.
Strategy 1: The Liquidity Safety Check
The most effective way to avoid scam wicks is to trade where the "walls" are thickest. Use the PERPTools Markets page to filter for safety before you enter a trade.
| Feature | Low Safety (Wick Risk) | High Safety (Protected) |
| 24h Volume | Low (under $1M–$5M depending on asset) | High (Top-tier assets like BTC/ETH) |
| Order Book Depth | Large price gaps between orders | Thick "Qty" clusters near the mid-price |
| Spread | Wide gap between Bid and Ask | Tight, consistent spread |
| Market Status | "New Listing" or low-cap altcoin | Established, high-market-cap tokens |
Strategy 2: Using "Mark Price" as Your Shield
One of the most powerful safety features on PERPTools is the distinction between Last Price and Mark Price.
- Last Price: The actual price of the latest trade on the exchange. This is what creates the "scam wick" on the chart.
- Mark Price: A calculated "fair value" derived from a basket of global spot exchanges (Index Price).
The Safety Rule: PERPTools uses the Mark Price to trigger liquidations. This means if a localized scam wick hits $3,000 on the "Last Price" but the global average stays at $3,100, your position stays open. Always keep the Mark Price metric visible in your Trading UI to know your true liquidation risk.
Strategy 3: Professional Execution Tactics
Once you've used the Markets page to find a high-liquidity asset, apply these execution rules to further insulate yourself:
- Avoid "Round Number" Stops: Scammers target round numbers like $50.00 or $3,000. Place your stop-losses at "odd" levels (e.g., $2,987.42) to stay outside the primary hunt zones.
- The "Buffer" Entry: Instead of a Market Order, use a Limit Order placed slightly inside the order book. This ensures you don't accidentally "sweep" a thin book yourself and create your own mini-wick.
- Lower Leverage on Altcoins: While PERPTools offers up to 100x, high leverage on lower-volume assets is dangerous. A 1% wick is all it takes to wipe out a 100x position. Save the maximum leverage for the deepest, most liquid markets like BTC.
Conclusion: Your 30-Second Safety Scan
- Start at Markets: Sort by Volume and pick an asset with deep liquidity.
- Check the Book: In the Trading UI, verify that the Order Book has significant "Qty" near your entry.
- Set Smart Stops: Use the TP/SL tool to set stops at non-obvious levels.
In the perpetual futures arena, survival isn't about catching every move—it's about avoiding the traps that wipe out your account in seconds. Scam wicks are engineered chaos designed to exploit the unprepared, but they thrive only in one environment: thin liquidity.
Before you even think about opening a position, make the Markets page your first line of defense. Sort by Volume to find where the real capital lives. Jump into the Trading UI and scan the Order Book, if you see gaping holes between price levels, that's your red flag. And when you're ready to execute, remember that Mark Price is your safety net; it's the difference between surviving a coordinated attack and becoming liquidation fodder.
The professionals don't rely on luck, they stack probabilities in their favor. High liquidity. Tight spreads. Non-obvious stop levels. Lower leverage on sketchy altcoins. These aren't complicated strategies; they're survival basics that separate the traders who compound gains from those who repeatedly deposit "just one more time."
