According to TechFlow, on September 11, K33 Research pointed out in its latest market report that the 30-day average funding rate of perpetual contracts has dropped to negative, which has only happened six times since 2018.
Analysts said that historically, the negative monthly funding rate often means the market has bottomed out. Data shows that within 90 days after the indicator turned negative, the average return rate was 79% and the median return rate was 55%.
At the same time, open interest in derivatives climbed to its highest level since late July, and short positions continued to increase. K33 Research believes that this situation, coupled with continued negative funding rates, puts the market at risk of a potential short squeeze.
The report pointed out that similar funding rate environments provide a very convincing reason to actively deploy Bitcoin in the coming months. Analysts also reminded that the uncertainty of the US presidential election may have an impact on cryptocurrency prices until the November election.
