Many people simply understand that if the price rises a lot, they should short it, and if it falls a lot, they should go long. Therefore, how to determine the next shorting or stop-loss signal is very important. During the OM period, there will be two reference directions:
1. The number of assets transferred to exchanges.
2. Changes in borrowing interest rates.
In fact, I am more looking forward to currencies that only have contracts and no spot trading, as this reduces the interference factors. Why does the cap occur once contracts are traded? Where does the cap originate from?
For liquid spot trading, on-chain data should be referenced, while for contracts with more abundant liquidity, I pay more attention to borrowing interest rates.
Trading boundary conditions:
1. Few chips within the exchange and low trading volume, all on-chain, with low circulation.
2. Significant fluctuations in interest rates.
3. An increase in the number of assets transferred to exchanges.
If the above conditions are met, one can trade borrowed assets to execute shorting logic.
