Predict the market for next week (my humble opinion, please don’t criticize if you don’t agree)
According to the latest liquidation map, the current price of BTC is 98041. Combining the liquidation wall and market data in the figure, we can make the following analysis on the market conditions next week: 1. Liquidation Wall Analysis 1. Short Liquidation Wall (Red): • Above the current price of 98041, there is less short liquidation pressure, which means that there are relatively few short leveraged positions in the market. • However, as the price approaches 102,000-106,000, the short liquidation volume gradually increases. This area is a potential resistance area. If the price breaks through here, it may trigger a large number of short liquidations and push the price to continue to rise.
Trading volume is an important indicator of market activity and trading sentiment. When trading volume is low, the market may show the following reactions: 1. Reduced price volatility • Low volatility: Low volume is usually accompanied by a decrease in price volatility, and the market enters a relatively stable or sideways state. In this case, the power of buyers and sellers is relatively balanced, and the market lacks directional momentum. • Narrow range fluctuation: Prices fluctuate within a smaller range, and investors are in a wait-and-see mood and are unwilling to enter or exit the market in a large scale. 2. Unclear trend signals
How to achieve funding rate arbitrage in Bitcoin perpetual contracts
Funding rate arbitrage is a strategy that uses the funding rate mechanism in Bitcoin perpetual contracts to conduct low-risk arbitrage. The funding rate is a mechanism introduced to keep the price of perpetual contracts consistent with the spot market price. When the market is bullish, the funding rate is usually positive, and traders holding long orders need to pay the funding rate to traders holding short orders; vice versa. Funding Rate Arbitrage Basics Funding rate arbitrage takes advantage of the fluctuation of funding rates and locks in the benefits of funding rates by conducting hedging transactions in the perpetual contract market and the spot market (or futures market) at the same time. The core of this strategy is to ensure that the long and short positions held in different markets hedge the market risks and obtain the risk-free benefits brought by the funding rate.
How to manage risks in Bitcoin perpetual contract trading
Risk management is one of the most critical parts of trading, especially in the highly volatile Bitcoin perpetual contract trading. Good risk management can help you preserve your capital when the market is unfavorable and maximize your profits when the market is favorable. Here is a detailed analysis on how to implement risk management in Bitcoin perpetual contract trading: 1. Position management a. Control the risk of each transaction • Risk Ratio: It is generally recommended to limit the risk of each trade to 1-2% of the total account capital. For example, if you have $10,000 in your account, the maximum loss per trade should be between $100 and $200.
Analysis of the impact of the US CPI data falling for four consecutive months on Bitcoin
The 4-month decline in the US CPI (Consumer Price Index) data indicates that inflationary pressures have weakened, which could have multiple impacts on Bitcoin and the broader cryptocurrency market. Here are some possible impacts: 1. Macroeconomic policy adjustments • The Fed’s policy direction: The decline in CPI data may prompt the Fed to slow down the pace of interest rate hikes, or even consider cutting interest rates. Such a policy shift usually reduces borrowing costs in the market and increases market liquidity, thereby supporting the rise in the prices of risky assets (including Bitcoin). • Weaker dollar: The dollar could weaken if the Fed eases monetary policy. This could increase investor interest in alternative assets such as Bitcoin, which is seen by some investors as "digital gold" or a hedge against inflation.
How to make stable profits in Bitcoin perpetual contracts?
Achieving consistent profits in Bitcoin perpetual contract trading can be very challenging, especially given the high volatility of the cryptocurrency market. However, here are some strategies and principles that can help increase your chances of making a profit: 1. Risk Management • Stop loss setting: Set a stop loss for each transaction to ensure that you can exit in time when the market is unfavorable and avoid excessive losses. • Position control: Do not over-leverage, and control the position of each transaction within 1-2% of the account. Too large a position can easily lead to large losses when the market fluctuates.