Bitcoin’s Funding Rate Divergence Raises Red Flags as Price Nears Key Resistance
Summary
Bitcoin's price has rebounded from a low of $74,000 to above $95,000, marking a 12% gain in the past week. Despite this increase, caution persists among investors, particularly in the derivatives market. Funding rates for perpetual futures contracts have turned negative, indicating a prevalence of short positions and hedging against potential downturns. This divergence between rising prices and negative funding rates raises concerns about the sustainability of the rally and the possibility of a short-term retracement. The Short-Term Holder Realized Price (STH-RP) is near critical levels, influencing near-term momentum. A potential pullback could occur, but it may lead to healthier market accumulation if it shakes out weaker participants.
