On Binance Futures, accounts going long $ETH accounted for 77.6%, the highest since September 17; but the funding rate has been negative for three consecutive settlements. The crowd is on the long side, while the money is on the short side.
These two figures can both be true because the account ratio counts accounts, not position sizes. Funding is calculated based on money: a negative rate means the perpetual price is below spot, and shorts are more eager to hold their positions, willing even to pay funding. Since August 3, there have been 200 settlements, only 18 of which had negative funding.
Positions are also changing hands. From midnight to noon today, futures open interest fell from 2.455 million to 2.393 million coins, a drop of 61,000 coins, or about 170 million U. Over the same period, the share of long accounts slipped only from 77.6% to 76.9%, while the large-trader long/short position ratio fell from 1.61 to 1.57. It’s the large positions that are exiting; what remains are small-account longs, bought all the way from 2,610 yesterday noon to 2,540 in the early hours today.
The 2,600.15 floor of the range that held for two weeks has broken. On a bounce, 2,600–2,615 is where these longs may look to exit at breakeven; the 4-hour EMA 200 is also at 2,614.5. To the downside, the 4-hour lower Bollinger Band at 2,529 and the daily EMA 50 at 2,506 are two potential support levels. The 4-hour RSI is 24.6, in oversold territory, but being oversold won’t clear the selling pressure overhead.
Yesterday morning I wrote that if the 4-hour candle couldn’t reclaim 2,625, I’d look for 2,564 first. The price later peaked at 2,623.83, then hit a low of 2,538.06 in the early hours today. I got this one right.
The biggest risk to this view is also the funding rate. From September 15 to 16, funding was negative for four consecutive settlements. By the end, the price was 2,403; over the next five days, it reached a high of 2,707.7, and shorts got squeezed.
I’m not adding to my longs, and I’m not chasing shorts here either. In my view, until those 77% of long positions are flushed out, 2,600 won’t be reclaimed.
Personal opinion
#ETH #FuturesOpenInterest
These two figures can both be true because the account ratio counts accounts, not position sizes. Funding is calculated based on money: a negative rate means the perpetual price is below spot, and shorts are more eager to hold their positions, willing even to pay funding. Since August 3, there have been 200 settlements, only 18 of which had negative funding.
Positions are also changing hands. From midnight to noon today, futures open interest fell from 2.455 million to 2.393 million coins, a drop of 61,000 coins, or about 170 million U. Over the same period, the share of long accounts slipped only from 77.6% to 76.9%, while the large-trader long/short position ratio fell from 1.61 to 1.57. It’s the large positions that are exiting; what remains are small-account longs, bought all the way from 2,610 yesterday noon to 2,540 in the early hours today.
The 2,600.15 floor of the range that held for two weeks has broken. On a bounce, 2,600–2,615 is where these longs may look to exit at breakeven; the 4-hour EMA 200 is also at 2,614.5. To the downside, the 4-hour lower Bollinger Band at 2,529 and the daily EMA 50 at 2,506 are two potential support levels. The 4-hour RSI is 24.6, in oversold territory, but being oversold won’t clear the selling pressure overhead.
Yesterday morning I wrote that if the 4-hour candle couldn’t reclaim 2,625, I’d look for 2,564 first. The price later peaked at 2,623.83, then hit a low of 2,538.06 in the early hours today. I got this one right.
The biggest risk to this view is also the funding rate. From September 15 to 16, funding was negative for four consecutive settlements. By the end, the price was 2,403; over the next five days, it reached a high of 2,707.7, and shorts got squeezed.
I’m not adding to my longs, and I’m not chasing shorts here either. In my view, until those 77% of long positions are flushed out, 2,600 won’t be reclaimed.
Personal opinion
#ETH #FuturesOpenInterest