⚠️ FUNDING RATES CAN COST YOU MONEY EVEN WHEN YOUR TRADE IS RIGHT!
Trading $BTC or altcoin perpetual futures?
Understanding funding rates is essential.
Funding payments help keep perpetual futures prices aligned with spot markets.
Here's the basic concept:
🟢 Positive funding:
Long positions generally pay short positions.
🔴 Negative funding:
Short positions generally pay long positions.
But here's what many traders misunderstand.
Positive funding doesn't guarantee a price decline.
Negative funding doesn't guarantee a short squeeze.
Funding reflects positioning incentives, not a reliable prediction of the next candle.
Before entering a futures trade, check funding, liquidity, volatility and your total trading costs.
Do you check funding rates before opening positions?
#CryptoEducation #FuturesTrading #FundingRate #RiskManagement
Trading $BTC or altcoin perpetual futures?
Understanding funding rates is essential.
Funding payments help keep perpetual futures prices aligned with spot markets.
Here's the basic concept:
🟢 Positive funding:
Long positions generally pay short positions.
🔴 Negative funding:
Short positions generally pay long positions.
But here's what many traders misunderstand.
Positive funding doesn't guarantee a price decline.
Negative funding doesn't guarantee a short squeeze.
Funding reflects positioning incentives, not a reliable prediction of the next candle.
Before entering a futures trade, check funding, liquidity, volatility and your total trading costs.
Do you check funding rates before opening positions?
#CryptoEducation #FuturesTrading #FundingRate #RiskManagement