$TBT open interest is 5,291 contracts. In the past 24 hours, the price has rallied by 2.436%. Yet the funding rate is reported as -0.0028, which means shorts are continuously paying longs.
The combination is very clear: while price breaks upward, bearish force has not retreated—instead, it’s stubbornly holding out against a negative funding rate. This is a classic structure of shorts being gradually squeezed. The transmission chain lies in politics. Fiscal pressure in an election year, plus the early pricing of the debt-ceiling standoff, are all driving expectations of volatility in long-end yields. The market is betting that rates will stay elevated for longer; Treasury prices are under pressure, and inverses like $TBT naturally benefit.
The strongest counter-evidence is this: if subsequent economic data unexpectedly weakens, or political pressure unexpectedly eases, yield expectations would fall quickly, and $TBT ’s rally would instantly lose its logical support. The second-order effect is that if this squeeze continues, hedge funds that previously shorted Treasuries would be forced to cover, pushing prices even higher—but volatility would be amplified sharply.
My view is based on a single signal (negative funding + price rising). If $TBT breaks below $36, this politically driven squeeze logic would fail, and I would need to reassess. My current stance is to watch the $36 area for support. If price stabilizes here and OI keeps increasing, I would consider initiating a small long position.
Trading tag: #TradFi #链上美股 #TBT
Where do you think this line of reasoning is most likely to be wrong?
The combination is very clear: while price breaks upward, bearish force has not retreated—instead, it’s stubbornly holding out against a negative funding rate. This is a classic structure of shorts being gradually squeezed. The transmission chain lies in politics. Fiscal pressure in an election year, plus the early pricing of the debt-ceiling standoff, are all driving expectations of volatility in long-end yields. The market is betting that rates will stay elevated for longer; Treasury prices are under pressure, and inverses like $TBT naturally benefit.
The strongest counter-evidence is this: if subsequent economic data unexpectedly weakens, or political pressure unexpectedly eases, yield expectations would fall quickly, and $TBT ’s rally would instantly lose its logical support. The second-order effect is that if this squeeze continues, hedge funds that previously shorted Treasuries would be forced to cover, pushing prices even higher—but volatility would be amplified sharply.
My view is based on a single signal (negative funding + price rising). If $TBT breaks below $36, this politically driven squeeze logic would fail, and I would need to reassess. My current stance is to watch the $36 area for support. If price stabilizes here and OI keeps increasing, I would consider initiating a small long position.
Trading tag: #TradFi #链上美股 #TBT
Where do you think this line of reasoning is most likely to be wrong?