The rate is capped at negative two, how to make this money

Today there are two particularly classic examples, one is LPT and the other is WCT

LPT has a rate of -2 capped, making money by going long

LPT on the Korean exchange triggered a massive rally, this surge was caused by expectations from the Korean exchange, followed by retail investors' FOMO sentiment leading to a significant rise in LPT. Retail investors saw LPT spike by 50% and all went short, causing the rate to hit the cap at -2%, resulting in LPT contract prices being significantly lower than spot prices.

At this moment, Binance announced a change in the rate adjustment time limit, from once every 4 hours to once every hour. This moment is the best time to build long positions in LPT contracts. Due to the surge in retail investors going short, the price difference between contract and spot prices became too large, leading to a massive short squeeze in the market, and contract prices would suddenly rise toward the spot price.

WCT capped rate, making money by going short

Why is WCT capped at -2 rate profitable for going short? Because this -2 rate is not caused by retail investors going short, but by the market makers building a large number of short positions at high levels.

WCT is a coin controlled by market makers, which is significantly different from LPT's rise. The market makers hold a large number of tokens, shorting at high levels on contracts while simultaneously offloading in the spot market.

Many retail investors see the -2 rate for WCT and open long positions to earn the rate, often resulting in losses.

The market maker for WCT previously tested a round of selling and then pulled it back, quite dog-like behavior.

When to build a short position, one characteristic indicator is that when WCT breaks below the moving average, one can establish a short position.

Another very important point is that the contract price is far lower than the spot price, at this time, one can boldly establish a short position. Do not hesitate to build positions just because the contract price is far below spot at this moment, as this price is caused by the market makers establishing a large number of short positions.

It can be seen that the reason the contract price is far lower than the spot price is actually due to who established the positions, the market makers or retail investors.

If the retail investors build short positions, then the retail positions will be squeezed, hence LPT will surge.

If the market makers build short positions, and they are continuously offloading in the spot market, then WCT will keep plummeting.