Hold onto your digital wallets, folks. Bitcoin’s open interest (OI) weighted perpetual futures funding rate just spiked to 0.012%, a level that screams “bullish”. Last time this metric hit such heights was back in late July, when Bitcoin took a joyride to $68k, only to get rugged in August, dropping 22%. Now, traders are getting hyped, but should they?
Short Squeeze and Funding Fever
This sudden uptick in funding rate is making waves, but seasoned hands like YouHodler’s Ruslan Lienkha are throwing out warnings. “Positive funding rates feel like a green light for bulls, sure, but the long-term’s still the wild west,” he says. Traditional markets, tied to real-world stuff like commodities, move at a snail’s pace. Crypto? Nah, it runs on vibes and memes.
Lienkha points out that unlike legacy assets, crypto has no slow-moving economic engine keeping it in check. So the sentiment is faster than airdrops hitting bots. A positive funding rate might suggest good short-term vibes, but volatility’s lurking around every corner, ready to pull the rug.
Liquidation Chaos Fuels Bullish Euphoria
Over the past 24 hours, Bitcoin’s been doing more liquidations than a Black Friday sale. Around $93M worth of Bitcoin positions went belly-up, with a whopping $83M of that coming from shorts. Yeah, you read that right. All those leveraged traders betting against Bitcoin? Poof, gone.
This short squeeze pushed Bitcoin over the $65k mark, finally breaking past its 200-day moving average. Bitget’s Ryan Lee is buzzing about it: “Bitcoin cracking $65,000 is major, especially with the U.S. election stoking some serious optimism in the market,” he said. But can the coin hold this level, or are we in for another fakeout?
U.S. Inflation Prints Fueling the Crypto Engines
It wasn’t just funding rates stirring the pot. The U.S. Producer Price Index (PPI) data came in at 0%, lower than expected. That’s good news for anyone fretting about inflation eating their crypto gains. And Core CPI? Even better, sitting at 0.1% instead of the forecasted 0.2%. All this news pushed Bitcoin into a higher gear, but whether it can keep pace depends on the market’s next moves.
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