Crypto: Negative Bitcoin Funding Rate May Signal Pending Short-squeeze...
Bitcoin holds its range trend even as the funding rate turns negative and BTC open interest flatlines. Is the data leaning toward a short-squeeze back to $70,000?
Bitcoin (BTC) slid to a weekly low of $64,111 during the New York trading session on Monday, taking out the range lows that were initially set on Sunday evening. Despite the weakness, the price action continues to rotate closely within the three-week range between $65,000 and $71,000.
Derivatives data outlines a clear lack of bearish follow-through for a deeper correction, while the liquidity positioning may frame the next move on the opposite side of the current trading range.
The recent price drop swept liquidity around $64,000 and liquidated roughly $240 million in long positions. Despite the sell-off, Bitcoin has remained within the established range that has been in place since Feb. 6. A sideways trend often builds pressure for an expansion, especially as the volatility compresses.
The Bollinger Bands have tightened, signaling reduced volatility and the potential for an expansive move.
The liquidity data shows a clear asymmetry. Roughly $1 billion in long positions face liquidation if the price tags $63,000. In contrast, more than $3.5 billion in short positions are vulnerable near a $70,000 retest. This creates a visible liquidity magnet on both ends of the range, though the concentration is notably denser on the upside.
Bitcoin open interest, which tracks the total value of outstanding futures contracts, has flattened near the local lows. Traders are not aggressively adding new exposure after the drop, possibly sidelined at the moment.
The funding rates have turned negative on the four-hour chart, meaning that the short sellers are paying the longs. This shift indicates that the positioning has tilted defensively while the price continues to hold the range support, opening the possibility of a short squeeze if the upside liquidity is targeted.
Trader Lennaert Snyder noted that Bitcoin “finally grabbed the $64,500 liquidity,” adding that reclaiming the $67,751 high may open the door toward $76,971, with partial profit targets along the way. A rejection near that level invites short-term downside toward the range lows.
Related: Bitcoin treasuries log rare selling streak as BTC trades near $66K
Source: CoinTelegraph
