Spot futures basis represents the price difference between a cryptocurrency’s immediate spot market price and its price in a corresponding futures contract. A positive basis, or contango, indicates futures prices are higher than spot prices, while a negative basis, or backwardation, shows futures prices are lower. This metric is a key indicator of market sentiment and expectations for future price movements. It influences arbitrage opportunities and trading strategies.
Context
Crypto news frequently analyzes the spot futures basis to gauge market sentiment and predict potential funding rate changes in perpetual futures contracts. A widening basis often suggests strong bullish sentiment, while a narrowing or negative basis can signal bearish trends. Traders monitor this basis for opportunities in market-neutral strategies and to assess hedging costs.
We use cookies to personalize content and marketing, and to analyze our traffic. This helps us maintain the quality of our free resources. manage your preferences below.
Detailed Cookie Preferences
This helps support our free resources through personalized marketing efforts and promotions.
Analytics cookies help us understand how visitors interact with our website, improving user experience and website performance.
Personalization cookies enable us to customize the content and features of our site based on your interactions, offering a more tailored experience.
