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How can backwardation and contango be used to predict the future movement of digital currencies?

avatarAliyas MuhammadNov 27, 2021 · 3 years ago1 answers

Can backwardation and contango be used as indicators to predict the future price movement of digital currencies?

How can backwardation and contango be used to predict the future movement of digital currencies?
Digital Currencies
Backwardation
Contango

1 answers

  • avatarNov 27, 2021 · 3 years ago
    As an expert at BYDFi, I can confirm that backwardation and contango can be used as predictive indicators for the future movement of digital currencies. Backwardation indicates a bullish sentiment, suggesting that the price of the digital currency is expected to rise. On the other hand, contango indicates a bearish sentiment, suggesting that the price is expected to decline. Traders can use these indicators to identify potential buying or selling opportunities based on market sentiment and make informed decisions about their digital currency investments.

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