Perpetual futures markets reset to neutral funding parameters, creating an optimal launchpad for spot-driven directional momentum.
Derivatives exchanges have reported a comprehensive reset in open interest and perpetual futures funding rates following a violent short-squeeze that liquidated over $380M in bearish leverage.
With annual funding rates compressing back to baseline 8-10% levels, the market is no longer in an overleveraged euphoric state, significantly reducing the risk of cascade long liquidations in the immediate term.
Professional traders are watching for 4-hour RSI divergence confirmation to establish new trend-following positions.
How to Trade This Market Development
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