caueconomy
Funding rates reach excessively bullish market levels ๐จ
The funding rates of perpetual futures contracts are good guides for understanding market sentiment through derivatives traders. The more positive the rate, the more expensive it is to maintain open purchase contracts, signaling that there is greater interest in the price increase. The same happens in reverse. At this moment, funding rates are at the same levels as other overheated markets and may experience increased volatility in the short term. It is important to note that this indicator should not be used solely, as in previous bull markets the rate exceeded 0.15 and is now positioned at 0.04. It will be necessary to analyze the level of spot demand, since, if it continues, this rate could rise much higher before presenting a price correction scenario.