A versatile trading indicator that compares futures and spot market dynamics, using VWAP to analyze market sentiment, potential arbitrage, and price relationships.
Explore complementary indicator rolesHow it works
The futures/spot dominance indicator automatically detects the futures symbol on the chart and requires manual input of the corresponding spot symbol. It collects historical price data for both futures and spot markets, including open, high, low, close prices, and trading volume.
Using the Volume Weighted Average Price (VWAP), the indicator calculates the premium or discount by subtracting the spot market VWAP from the futures market VWAP. This calculation provides a nuanced view of market dynamics, with positive values indicating a premium and negative values suggesting a discount.
Why it may be useful
The futures/spot dominance indicator offers critical insights into market sentiment and potential trading opportunities by revealing the relationship between futures and spot markets. It helps traders understand underlying market dynamics, providing a deeper understanding of price movements and potential arbitrage scenarios.
By integrating VWAP and tracking premium/discount relationships, traders can make more informed decisions about market trends, risk management, and potential entry or exit points. The indicator's ability to highlight market sentiment and price discrepancies makes it a valuable tool for sophisticated trading strategies.
When to explore it
This indicator is most effective during periods of market volatility or significant economic events that might create price disparities between futures and spot markets. Traders can leverage it to identify potential arbitrage opportunities, assess market sentiment, and confirm trend directions.
It is particularly useful for traders dealing with cryptocurrency, commodities, or other derivatives markets where futures and spot price relationships can provide meaningful insights. The indicator's alerts and VWAP integration make it valuable for both short-term and longer-term trading strategies.
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What we’ve verified
Access, alerts and repainting behaviour have not been independently verified for this indicator. Check the creator’s current publication and settings.
General descriptions and classifications are recovered research. Verified details above identify the specific checks we have completed. Check the creator’s current publication for later changes.
