This Bitcoin Move is the Real Deal
- Bitcoin has based at its 2021 cycle highs and is starting to trend higher for the first time in years.
- Funding rates are persistently negative, meaning speculators are crowded short.
- The conditions are ripe for a short squeeze in crypto.
You've had all the time in the world to get more exposure to Bitcoin.
And look, trust me, I'm not that guy to constantly be in your inbox telling you to buy Bitcoin.
The people that have been bullish Bitcoin have gotten smoked.
But this time is truly different, and the train is leaving the station.
Support has been found at these prior cycle highs hit in 2021.
And zooming in on the day-to-day price action, a nice base has been formed.
The trend has now begun shifting higher.
But what makes this rally different from the other failed ones?
Funding rates.
They have been persistently negative for the first time in years.
What is a "funding rate" and why should I care?
I had a recent chat with someone deep in the crypto trading game. He regularly talks with guys in their twenties that have cleared eight-figures trading crypto alone.
And he told me that the traders around him are bored out of their minds.
They're now trading commodities and stocks because that's where the action is right now.
Funding rates basically calculate that attitude.
They're the difference between the spot price of Bitcoin (dominated by investors) and the futures price of Bitcoin (dominated by speculators).
When funding rates are negative, it means that speculators are leaning bearish.
Practically, it means that shorts are the crowded trade right now.
NOBODY is talking about a "short squeeze" in Bitcoin.
But I think it's coming.
Price looks constructive for the first time in years, and speculators think that it fails.
What could go wrong...
I learned something today.
Anyway, that's the setup people are ignoring right now.
I spent the long weekend to go diving for sea urchins here in New Zealand.
Though, I learned the hard way that they have a breeding season so it turned out to be a spectacular fail, lol.
Cheers,
Louis Sykes
Senior Crypto Analyst, All Star Charts
