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EnsoTradeLearn › Futures basis

What is Futures basis?

Basis is the difference between a futures price and the spot price. A rich positive basis (contango) signals leveraged long demand; a negative basis (backwardation) signals fear or heavy short demand.

How to read it

A widening positive basis shows speculative leverage building. A flip to negative basis often marks capitulation or a deleveraging event.

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FAQ

What is the basis trade?
Buying spot and shorting the future to capture the basis as it converges — a market-neutral yield strategy.

Related

Funding rateOpen interestOrder flowDealer gamma (GEX)LiquidationShort squeezePerpetual futuresLong/short ratio

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