As a researcher with a background in cryptocurrency markets, I find the recent developments in Bitcoin’s funding rate and annualized basis rate intriguing. Based on my analysis of the available data and insights from industry experts, it seems that these indicators could suggest an upcoming bullish trend for Bitcoin.
A cryptocurrency expert suggests that two significant indicators for Bitcoin (BTC) trading – the funding rate and the 3-month annualized basis rate – may indicate that the price is poised for an upturn based on their current readings.
As a researcher studying the cryptocurrency market, I’ve noticed that we seem to be experiencing a period of consolidation before potentially seeing another price increase. This observation is based on recent developments in Bitcoin’s funding rate and Basis rate, which have both mellowed down after briefly displaying negative readings.
The funding rate of Bitcoin is frequently utilized to gauge the broader sentiment among traders in the cryptocurrency market. Exchanges employ this rate to offset the positions of traders going long with those preferring to sell short, thus minimizing potential risks from excessive exposure.
Long-position traders boosting their holdings suggest a bullish outlook on Bitcoin’s price, leading to a positive funding rate.
Currently, the OI-adjusted funding rate stands at 0.0091%. It bounced back from a previous negative rate of -0.0050% that was recorded on May 4, according to CoinGlass statistics.
“Sounds like the calm before the storm,” said pseudonymous crypto commentator Crypto Empire.
“Mister Crypto, a pseudonymous crypto trader with 98,000 followers, expressed strong optimism in the bitcoin market as he noted, ‘The low funding rates persist despite Bitcoin’s bounce-back. This situation fills me with great bullish sentiment.'”
Over the past four days, Bitcoin’s price experienced a modest rise of 1.11%, reaching $62,361 according to CoinMarketCap information, parallel to a slight adjustment in the funding rate.
Yet, the data from liquidations indicates a contrary perspective, implying that speculators in the futures market remain biased towards bearing positions and expect a decline in prices soon.
As a researcher examining the financial market, I’ve discovered that a 3.5% increase in price to the significant level of $65,000 could result in the liquidation of approximately $1.36 billion worth of short positions. On the other hand, a 3.5% decrease in price down to $60,500 would only lead to the elimination of around $650 million in long positions.
Concurrently, certain cryptocurrency traders observe that the annualized Bitcoin basis rate has risen to the upper limit of the usual 5-10% benchmark on prominent trading platforms like Binance, OKX, and Deribit.
As a researcher studying the financial markets, I would describe the annualized basis rate as a metric used to quantify the disparity between the price of a Bitcoin futures contract and the spot price of Bitcoin on an yearly basis.
Traders often view rates above 10% as a neutral-to-bullish signal.
Read More
- Top gainers and losers
- DOP PREDICTION. DOP cryptocurrency
- LDO PREDICTION. LDO cryptocurrency
- JASMY PREDICTION. JASMY cryptocurrency
- KAI PREDICTION. KAI cryptocurrency
- MOCHI PREDICTION. MOCHI cryptocurrency
- SILLY PREDICTION. SILLY cryptocurrency
- STOG PREDICTION. STOG cryptocurrency
- WRLD PREDICTION. WRLD cryptocurrency
- WOJAK PREDICTION. WOJAK cryptocurrency
2024-05-08 06:33