⚡ What the basis tells you.
Funding rate = what perpetual longs pay shorts every 8h (or vice versa). Positive funding = longs paying = bullish positioning crowded.
Negative funding historically marks local bottoms (shorts forced to pay longs = capitulation).
Basis = futures premium over spot. Contango (futures > spot) = bullish term structure. Backwardation = bearish.
Annualized basis yield = the cash-and-carry trade return (buy spot, short futures).