$BABA at the 113.03 level, down 3.153% over 24 hours, while the funding rate is positive at 0.00055321. Price is falling and the funding rate is positive—this is a typical structure of longs being trapped and forced to keep paying fees.
The core variable in the Trump trade right now is tariffs. Wikipedia records that he announced a national emergency in April 2025, imposing a minimum 10% reciprocal tariff on almost all countries. The Tax Foundation estimates that such policies will, in the long run, drag down U.S. GDP by 0.4 percentage points. As
$BABA is directly exposed to U.S.-China trade friction, the stock price is extremely sensitive to this narrative. The predicament for longs right now is that they bet on policy easing or that China’s domestic demand would offset the impact—but the funding rate shows they are still paying while waiting, meaning their position costs are accumulating.
A counterintuitive comparison: Bloomberg reported that Trump’s tariff policies unexpectedly caused Canada’s stock market to outperform the S&P 500 for two consecutive years. This suggests that market pricing is complex; the punishment may not fall on all exporting countries, and capital could flow to markets perceived as relatively benefiting. For
$BABA , shorts may think it is the one being punished, while longs are betting this time is different or that there has been an overreaction.
The current open interest is 141344.22. Taken together with the funding rate, it suggests shorts have not been squeezed out at scale; instead, longs are bearing the funding costs. This means that if the selloff continues, longs near liquidation could trigger further downside. This is based on a single signal and lacks micro-level on-chain data to validate large trades.
The conditions for invalidating this bearish structure are: Trump shows clear signs of easing on the tariff issue, or
$BABA ’s funding rate quickly turns negative (which would imply shorts start crowding and paying fees). Until the price returns to recent highs and the funding rate stays positive, negative funding is the key indicator that sentiment is turning.
I wouldn’t average down here. Price falling combined with a positive funding rate is a classic high-cost positioning structure. I would wait for one of two signals: either the funding rate turns negative and the price stabilizes, showing shorts are starting to absorb pressure; or there is news of a substantial breakthrough in trade negotiations.
If I absolutely must act, in an aggressive scenario I would lightly short and set the stop-loss near the prior high, but I have to accept the risk of an abrupt policy shift. The more prudent choice is to wait and observe, letting both bulls and bears burn through the position costs created by the funding rate.
Trading tag:
#TradFi #链上美股 #BABA
Where do you think this thesis is most likely to be wrong?