GIF
Evidence that a sudden increase in the leverage ratio does not necessarily lead to a large decline.
We analyzed the correlation between the leverage ratio and the funding rate. The results show that when the leverage ratio reaches a local top, the bias of the FR up to that point influences the next major price movement. If the FR continues to deviate from the norm to the negative (short receiving, short position bias) by the local top, the market tends to rise significantly afterwards. On the other hand, if FR continues to deviate from the norm to the positive (long receiving, bias toward long positions), the market price tends to fall sharply thereafter. From these regularities, we can use PA and TA to predict the next big price move. This indicator was suggested to me by a member of my community. Thanks to them.