#TON Be cautious in shorting, focus on spot and arbitrage opportunities

In the contract market, shorting needs to be cautious, and its risk is much higher than spot buying or contract long. In particular, single-position shorting is opposed, unless a BTC long position and other currency short position hedging strategy is adopted. For both novices and veterans, I do not recommend large positions to short for profit. Historical cases such as the heavy losses suffered by LUNA short sellers are a lesson for the past. When shorting junk coins, large positions are easily aggregated, and the funding rate becomes a weapon to devour funds, and the late-stage pullback often leads to liquidation. In contrast, the strategy of selling spot and waiting for the decline to cover is more secure. Although there is a risk of selling at a high price, there is no risk of liquidation.

Analyzing the GFT case on August 6, the position did not surge with the price increase, indicating that the dealer closed the long position, the funding rate was negative and the contract price rose, indicating that there was a long-short confrontation in the market. In fact, the dealer used the spot to pull up to create arbitrage opportunities. When the spot price is high and the contract price is low, sell the spot price and buy the contract price for arbitrage; otherwise, buy the spot price and short the contract price. In this case, after the position volume steadily decreases, the dealer smashes the spot price, and the short position is closed with profit, achieving a double kill of long and short positions. The dealer dares to short because the spot chips are in hand. If retail investors blindly follow the trend, they will easily become lambs to be slaughtered.

Therefore, it is recommended that investors pay attention to the spot market and arbitrage opportunities and avoid blind shorting. For more information about the currency circle, bull market potential coins and spot strategies, please click on the avatar to explore. As for the timing of the Fed's interest rate cut, it is necessary to pay close attention to market dynamics, analyze rationally, and seize investment opportunities.

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