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Arbitrage

Cross Exchange STETH Arbitrage Despite Peg RecoveryThe FTX:STETHUSD (Lido Stacked Ether) lost its 1:1 peg with ETH since back in May, but more interesting is the extreme volatile pattern within arbitrages between CEX and DEX's, as well as cross-exchange arbitrages that developed on STETH. Something increasing despite the pegging recovering last 24 hours. Now the STETH arbitrage is almost bigger then the ETH to STETH arbitrage, presenting profitable moment for those in the markets. Quick background: lost its 1:1 peg with Ether starting around the time of the UST (Terra) depegging, and then this was amplified in recent days on 8th of June due to a multitude of reasons mostly due to fears amongst some of Celsius Network quickly running out of liquid funds to pay back investors (read threads like this for more background: twitter.com ). Now the peg is recovering though, but due to lots of market uncertainty and fear still, rare large fluctuating arbitrages (of 1-2%). Which just this moment on the current bar has crossed over the ETH to STETH arbitrage. Opportunistic in the manner that we look for rapid changes between sides of the zero line on the Arbitrage charts so we can buy > sell and sell > buy regularly without needing to perform any cross-exchange transfers (and thus minimise fee's and risks too).
FTX:STETHUSD
by sufficientSucc98523
Cross-Exchange Crypto Arbitrages Opportunities AnalysisDue to the inefficiency that still exist within the new crypto industry, large arbitrages exist especially during periods of volatility . Presenting risk-minimal trading opportunities for individuals, sometimes without the need to hold the token/crypto asset for very long at all. Trading-view did not allow me to share less then 15min timeframe chart, but to analysis arbitrages you need a much smaller time-frame, for example as i examine in 1 minute time-frames below: The first chart show the price differences between different exchanges for the same asset (easy enough for anyone to setup, just subtract price on one exchange from the price on another for the same token pair). Whilst the second chart shows a small circle / dot whenever an arbitrage of more then 1% opportunity occurs, with the y-axis showing the percentage differences (or gains to be made) from that pairing. If that difference is greater than set 'min_profitability' a label will also pop up with showing which exchange to BUY (or LONG) and which exchange to SELL (or SHORT) the asset to gain this arbitrage profit (eg. >1% - fee's). The labels will remain as long as thats the most recent opportunities for those exchanges, and disappear when a new opportunity arises on that exchange pairing. To take advantage of this tool: 1. Setup custom charts like i did. And then your 'var' set, go to 'settings' and it gives you options; where you put the name of different exchanges you would like to use (followed by a ":") and then whatever crypto asset(pairing) you want to trade. Eg. in this example i have put BINANCE:LUNABUSD as the first option, KUCOIN:LUNAUSDT , etc.. but you could pick lots of different ones, looking for whatever has good patterns and sufficient liquidity. My tips: i first go to crypto screener: ( www.tradingview.com ), and sort out based on certain criteria, including '24 hour trade volume' > X amount, Volatility > X% amount etc, looking for pairs that have high volatility (means will have lot more arbitrage opportunities) and the exchange/pair have sufficient trade volume & liquidity to allow for high frequency and high enough volume trades to occur. At the time of posting this, OKCOIN:LUNCUSD , COINBASE:OMGUSD , BINANCE:THETAUSDT , BINANCE:GMTUSDT are other examples that have very high volatility. Even INDEX:BTCUSD showed some high volatility this week, and as such would be suitable. 2. Then you can do one of three things here: Option (a) Bot-trading : to analysis opportunities for using a arbitrage bot find the pair with the best pulsating or radio frequency look. Or in other words an exchange and crypto pair that has a good high frequency pulse (the blue in this example as such is the best exchange pairs). Also not necessarily want the pair with highest arbitrage as you need a pairing that moves above and below the 0 (zero-line) frequently, so it can do lot of trades both ways for example Exchange A > Exchange B (A.BUY > B.SELL) and then (A.SELL >N.BUY), to keep rebalancing the portfolio or holdings of crypto asset or stable-coin in the exchanges so trades can keep occurring frequently and arbitrage profits can be realised. Then you can also examine the pulses and find at what percentage the pulses 'candles' tends to cross or hit above/below the most frequent (or is the most profitable on analysis over a 24hour window) to config your bot. In this case the green lines the blue one tends to hit frequently, so as such this would be the min profitability config i set for the bot on this exchange pairing. This strategy might hold more risk as need to hold both currencies on all exchanges to do it. This approach could also be done manually, if doing it manually set up ALERTS for whenever the dots occur (arbitrage opportunities) which will signal a notification on your tradingview app (computer and/or phone) informing you what trades to make and then do those. Option (b) Manually Transfer Between Exchanges: the method that Sam Bankman-Fried first got rich and famous for doing with his Alameda Research company before he founded FTX ( finance.yahoo.com ). To do this strategy look for the one with the big arbitrages that hold for a long-time, and manually buy the crypto on exchange 1 (↑) that is the lowest, and then transfer it over manually to sell it on exchange 2 (↓). On this one example, an arbitrage between HUOBI:LUNAUSDT & BINANCE:LUNABUSD of 12.5% occurred today and it has also held up that arbitrage (>2%) for most of the day. If more then one pair is in arbitrage, then you can repeat across a 3rd exchange, before coming over to the first exchange again. This way you balance out all your assets (across the exchanges) back to where they were to start with. Make sure to pick ones that hold their arbitrage for a long-time, so have time to buy, transfer, and sell, then withdraw Fiat or stable-coin back, and exchanges that allow easy withdrawals. Try pick exchanges that have the same bank, or even use the same bank as you do, so withdrawals back to your bank are fast / near instantaneous. The purple in this example is following similar pattern to the KimChi and Japan premiums that Sam Bankman-Fried took advantage of actually, as that is Huobi exchange (a Chinese exchange) which tends to show differences due to different peak trade (liquidity) periods compared to exchanges with Americans and European trading during different time-zones. Option (c) Derivative Hedge: : probably has the lowest risk. Here to use derivatives or perpetual contracts, and go LONG on the cheaper exchange and go SHORT on the higher priced exchange, so no cross-exchange transfers of assets are needed to re-balance your portfolio across the exchanges, and there is no need to hold onto a possibly risky/highly volatile asset neither. So for this example pick the purple one and then wait until the arbitrage stops, or the difference between the two exchanges comes back near to 0, which you can see on the chart, and then close the positions and thus making the arbitrage gains, and closing off to not hold any crypto. And wait until the peak arbitrage occurs again to open up the two positions again. A hybrid of this can be utilised to minimise your risk in Option (b) to, so open up a SHORT hedge on the exchange once you BUY that crypto and keep that SHORT open until you manage to SELL and withdraw on the other exchange so that you don't risk loses from a sudden price movements of the underlying asset. Developed by Shane (Laowai Koala on Hummingbot's Discord): Im a sports physiotherapist and Masters in Data Analytics university student (not at all a financial expert), whom is just practicing some coding and data science skills. Still learning, and trying hypothesis out to make easier for anyone. As such this is just opinions and not financial advise, and also may have some bugs in the indicator script code i still need to improve or fix up before its open source (patience is a virtue).
L
by sufficientSucc98523
Opportunity? Avg Price > Current Cost on LRC:USDAverage weighted price is currently 1.50. The current price of is .99 cents. LRC is a fantastic project integrating ZK-Rollups to reduce tremendous transaction costs. It's being picked up by big institutions and the API / back-end is well maintained to support development. Overall, fantastic product and ecosystem. I recommend it. Big adoption will be by main-players. Instagram, Twitter, Google + YouTube, Apple, GME, etc. I think the weekly time-frame is important when looking at places to park money in, unless you are scalping with high leverage. Not really sure, as always, let me know what you think. I think it has potential, and that's why I'm flagging it as an opportunity to share.
FTX:LRCUSDLong
by wmcphail
Rare Arbitrage Play in the Works? Possible insane melt up?TTF Futures are currently at 115, and to get the US MMbtu equivalent of 31-33$, and they peaked at around 60-63$ US Natural gas equivalent ( For reference those are BOE of nearly 300-330$). Around December of last year the US Started to export Natural gas in the highest amounts in a long time to take advantage of the higher prices and to help europe keep its lights on. Price difference alone may not trigger the arbitrage, but rather possible sanctions. We already had the NordStream 2 pipeline cancelled, and eithe Russia might trigger a cancellation of the first Nordstream 1 pipeline as well as supplying of oil and gas to countries that sanctioned it OR the Western Europe/Nato powers might do it. No doubt that oil would have a melt up situation. But natural gas to could have a huge melt up far more then oil as with no gas available in europe they would be forced to use us gas, and this could get rid of the insane spread. If Russia turns of its pipeline, we could see europe gas prices rocket to 200-400$ if all gas is turned off ( 1200-2400$ BOE ). These prices are obviously quite crazy, so it would make no sense for europeans to buy their local gas when America can supply for far less If all of europe does this " save money hack " however buy the law of arbitrage the spreads would largely diminish over time.
NYMEX:NG1!Long
by NuancesofTrading
1
Nasdaq Daily Reversal — Arbitrage & Sectorial RotationAmidst a financial market strongly distorted by the thirst of control from the central banks & their monetary policy craze headed exclusively toward supporting inflating assets valuation, it's become more & more obvious prices no longer represent neither economic reality nor actual asset value (assuming they ever did). Therefore, in such a climate of financial & speculative assets hyperinflation, it's highly interesting not to be too directional, on major indexes as an exemple, and rather seek arbitrage trading between different sectors. Today i'm proposing a Daily Nasdaq reversal short, within the aforementioned framework of arbitrage, as a hedge-trade against the Dow Jones, Tech vs Industrials . Let's have a look at the Nasdaq/Dow Daily spread-chart FX:NAS100/FX:US30*100 (the *100 in the mnemonic was added to obtain more detailed «Volume profile» data / rows) : As you can see, the spread between the two sectors has been ranging since summer of last year, showcasing clear arbitrage strategies being put in place between the two assets / indexes. Strategies that were most likely triggered as a result of widespread doubt amongst market professionals about global assets' valuation and their direction. Now addressing the technicalities of our spread, it should be noted that, on that specific timeframe, we've already broken the range' support during early of March. The spread reaching its upper pitchfork/canal boundary in conjunction with a 76,4% Fibonacci retracement right after breaking its range' support, points out toward a pretty good timing to start taking action on the components of spread itself. We can also witness a few enticing overload signals on the momentum/sinewave indicators, but signals on spread-charts are never to be taken too seriously as they're not extremely reliable. To end with the spread-chart and contextualise a little bit more in-depth, this year long recent hedge trade on the two major U.S indexes becomes even more obvious when you switch to the Monthly timeframe, just to realize that NDX/DOW is a monthly range as well. You can also easily notice that the Daily hedge-trade strategies that have been put in place since summer 2020 coincidently happened to be taken on prices very close from the 2000 highs of the spread-chart (the year 2000 which happened to mark the end of the .com tech crazed bubble). Hesitation on a monthly top, heh. So we've got short term timing & technical elements aligning with the broader decade long context, good. Now let's take a look specifically at our Nasdaq chart to outline more relevant technical elements that are going to lead to our trade. Starting with the context : on the Monthly timeframe we can see that our beloved tech sector is no less than a bubble : a parabolic structure perpetually accelerating with increasingly ascending support trendlines, and not materializing any kind of consolidation whatsoever. It should also be mentioned that we havent finished a Monthly momentum cycle since 2012 (2010 for the Quarterly timeframe). Bubble meaning no cycle, consequently meaning a market structure' maturity excruciatingly harder to discern — that is besides the volatility burst & the chaotic range that precedes the final excess leading to the market top. A context to handle with care, to say the least. Now that we know the broader direction the market is currently taking, we can start to look at our timeframe of reference, the Daily one : Here are the different technical elements i could outline from that chart : Prices Reaching the upper boundary of both the Schiff Pitchfork & the Regular Trend Canal 88.6% Fibonacci extension hit & showing short term price slowdown 138.2% Fibonacci retracement from the last downward consolidating move, supposing a potential running or expanded flat Signals Cycle Alignement of both Sinewave & Momentum Momentum about to print an overload signal (will confirm or not depending on the next Daily closes) Momentum pointing at a possible triple divergence Would appreciate an engulfing bearish candle close on the Daily timeframe within the next few days Risk Management The invalidation on this Nasdaq Short costs 3%, therefore i won't expose more than half of my capital on this position, that way i'm risking no more than 1.5% of my capital as a speculative loss on this trade (and even less with the Dow long part incoming). Validation levels are showcased on the chart based on «footprints» (historical low volume areas found using volume profile), lower boundaries of channels / pitchfork and Fibonacci retracements. TP 2 means at most a total of 50% profits taken on the original position. The rest will be held for lower targets on the Weekly / Monthly timeframes. I'll further update this analysis as soon as the Dow Jones reaches its next supports areas (if it does so), especially since those same areas will allow me to start executing the opposite part of this hedge-trade (the long one). But that's it for now Hope this idea will inspire some of you ! Go easy on leverage and don't forget to hit the like/follow button if you feel like this post deserves it ;) Kindly, J.M.K
OANDA:NAS100USDShort
by John_Maynard_Keynes
1