Perpetual Futures Guides

A perpetual future — or “perp” — is a derivative contract that tracks an asset’s price with no expiry date. You can hold a position for minutes, days, or months, and a periodic funding payment between longs and shorts keeps the contract price tethered to the underlying spot market.

Funding is a small periodic payment between long and short position holders that keeps a perpetual contract’s price anchored to the underlying spot index. Reading funding tells you who’s crowding which side of the trade — and when a squeeze might be brewing.

Open interest (OI) is the total number of outstanding perpetual contracts that haven’t been closed. It measures how much leveraged positioning is stacked in a market — and when it moves against a flat price, it’s often the warning sign before a violent unwind.

Order flow is the tape behind the chart: how aggressively buyers hit asks, how much resting liquidity sits on the bid, and who is absorbing the other side. Traders who read flow act on what’s happening in the book — not after a candle has already moved.