Also, liquidation needs to be understood with regards to isolated and cross margin modes and the reason is because many people jump into trades without a clear understanding of what the liquidation prices of their trades are, and by the way, liquidation price is the price that if the market breaches, causes you to lose the entire money you put into a trade.

In isolated margin mode, the margin used for any open position is what gets liquidated if the trade goes against you a hundred percent, which means that your margin balance or account balance would not be at risk. If you have multiple open positions or trades, the liquidation of the margin for any trade doesn't affect the others because each trade is isolated from the rest. 

However,in cross margin mode, the entire account balance is used as collateral for all open positions which means therefore that once you are liquidated, you have lost all the money in your trading account unlike in isolated where your account balance would be safe. It is worth pointing out that because the entire account balance is used as support for your open position, in cross margin, liquidation price is therefore usually far away from the market price of the underlying asset or crypto you are trading, but opening multiple positions can jeopardize this, hence it is better to avoid taking multiple trades in cross margin because it brings liquidation price closer to the market price 

Now, you might be asking, at what point exactly does the liquidation occur?Well, exchanges have this thing called maintenance margin which can be expressed as a percentage. They use It to protect themselves from losses if your trade goes bad. This is the minimum amount of money that must be maintained in your account to keep your trades running. 

So let's say you entered a trade with a margin of $50 on a 10x leverage meaning therefore that your position size was $500. If the maintenance margin requirement for the trade was 5% of your position size, that meant that your initial $50 margin must not equal or fall below $25 because 5% of $500 is $25. 

Whenever you take trades, check the details of the trade, you would always see the maintenance margin whether you are using cross or isolated margin, if your margin equals or falls below that, the exchange would close the position but what usually happens is that you would get what is termed “ margin call”, which is usually an email sent to you by the exchange reminding you to manage your position by adding margin to avoid liquidation.