Closed P&L sums the profit and loss realized when positions close, voluntarily or not. Liquidation volume sums the notional of positions closed by force. On a flush day both spike, but they measure different things, and confusing them leads to bad analysis.
01The difference
A liquidated 100x position of $1M notional adds $1M to liquidation volume and, if wiped out fully, only about $10K to closed P&L, since the trader only posted that much margin. A whale closing a profitable $50M position voluntarily adds $50M to closed P&L and nothing to liquidation volume.
So liquidation volume tracks forced flow and its pressure on price, while closed P&L tracks money actually made and lost by traders. Big liquidation volume with modest closed P&L means many leveraged accounts died. Modest liquidation volume with big closed P&L means sizey positions moved, by choice.
02Using both
On this site we record liquidations directly. Closed P&L style aggregates appear in some vendor dashboards, and when you compare them with our numbers, keep the definitions apart: forced notional on one side, realized money on the other. The pair together separates a cascade day, heavy in both, from a repositioning day, heavy only in P&L.