The average funding rate across the market is -0.054%—shorts are seriously crowded.
$ERA has a funding rate of -0.70%, and $RLC is at -0.28%. In other words, there are too many people shorting, so they have to pay the longs. Meanwhile, ADA, NEAR, and WLD are all at +0.01%—the longs aren’t getting anything like that treatment.
I don’t judge a squeeze by the funding rate alone; I look at the combination of price and open interest. A rising price alongside falling open interest means shorts are admitting defeat and closing out. If both price and open interest are rising, that means new positions are coming in to take over—not a squeeze.
It’s the same here: extreme readings can stay extreme for a long time.
$ERA has a funding rate of -0.70%, and $RLC is at -0.28%. In other words, there are too many people shorting, so they have to pay the longs. Meanwhile, ADA, NEAR, and WLD are all at +0.01%—the longs aren’t getting anything like that treatment.
I don’t judge a squeeze by the funding rate alone; I look at the combination of price and open interest. A rising price alongside falling open interest means shorts are admitting defeat and closing out. If both price and open interest are rising, that means new positions are coming in to take over—not a squeeze.
It’s the same here: extreme readings can stay extreme for a long time.