Data shows the Ethereum funding rates have been quite negative in recent days. Here’s what this could mean for the cryptocurrency’s price.
Ethereum Funding Rates Have Been Under The Zero Mark Recently
As explained by an analyst in a CryptoQuant post, a short squeeze may be a possibility for the asset currently. The “funding rate” is an indicator that keeps track of the periodic fees that traders on the futures market are exchanging with each other.
When the value of this metric is positive, it means that the long contract holders are paying a premium to the short holders right now. Such a trend implies the longs outweigh the shorts currently, and hence, a bullish mentality is the dominant force in the sector.
On the other hand, negative values suggest the majority of the futures market users share a bearish sentiment at the moment as the shorts are the ones paying a fee.
Now, here is a chart that shows the trend in the Ethereum funding rates over the past week:
As displayed in
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