$LA Current funding rate: -0.102% (settled every 4 hours); shorts pay.
When I first started trading futures, I always thought the funding fee was a fee charged by the exchange. Later, I realized that this money is only paid or collected from people holding positions at settlement. It flows between longs and shorts, and the platform takes no cut.
When the rate returns to normal, it’s usually either because of a price correction or because traders on the crowded side exit. Which one it is depends on how open interest moves afterward.
Understanding this indicator helps you avoid being misled by the numbers; it’s not a way to accurately predict price movements.
#LA
There’s considerable volatility, so manage your leverage carefully.
When I first started trading futures, I always thought the funding fee was a fee charged by the exchange. Later, I realized that this money is only paid or collected from people holding positions at settlement. It flows between longs and shorts, and the platform takes no cut.
When the rate returns to normal, it’s usually either because of a price correction or because traders on the crowded side exit. Which one it is depends on how open interest moves afterward.
Understanding this indicator helps you avoid being misled by the numbers; it’s not a way to accurately predict price movements.
#LA
There’s considerable volatility, so manage your leverage carefully.