$SOXS 24 in a 24-hour period it rose 4.67%, with the funding rate pushed up to 0.0171%, and positions at 431,000 lots.
As soon as geopolitics gets tense, the shorts start shorting military-industry/defensive assets—and then they got squeezed. A positive funding rate means longs have started paying shorts; overcrowding is rising. This kind of rally is a bit artificial—it's propped up mainly by sentiment. Once geopolitical heat fades, the rate will immediately compress prices.
The counterargument is: if the conflict really escalates into a full-scale war, then military-industry stocks still have room to fly. For second-order effects, short-covering could trigger a further pop, but the price is already quite high; afterward it's likely that someone will start rushing to get out.
Trading tag: #TradFi #链上美股 #SOXS
Where do you think this thesis is most likely to be wrong?
As soon as geopolitics gets tense, the shorts start shorting military-industry/defensive assets—and then they got squeezed. A positive funding rate means longs have started paying shorts; overcrowding is rising. This kind of rally is a bit artificial—it's propped up mainly by sentiment. Once geopolitical heat fades, the rate will immediately compress prices.
The counterargument is: if the conflict really escalates into a full-scale war, then military-industry stocks still have room to fly. For second-order effects, short-covering could trigger a further pop, but the price is already quite high; afterward it's likely that someone will start rushing to get out.
Trading tag: #TradFi #链上美股 #SOXS
Where do you think this thesis is most likely to be wrong?