The latest Commodity Futures Trading Commission (CFTC) figures show that leveraged funds, defined by the Commodities Futures Trading Commission (CFTC) as hedge funds and commodity trading advisers, ramped up their bearish bets on futures.
This aligns with the ‘basis trade,’ a leveraged arbitrage strategy that speculators have used extensively throughout the year to capitalize on the price disparities between the underlying asset and futures.
At the end of the first quarter, speculators’ short positions reached a record level as the flagship cryptocurrency‘s price rally stalled. These funds increased their net short positions in the Chicago Mercantile Exchange’s (CME) standard bitcoin futures contracts to 16,102, marking the highest since these futures started trading in late 2017. Each of these contracts represents 5 BTC.
Short futures positions, a strategy that involves selling a futures contract in anticipation of…
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