Recently, I’ve noticed that the funding rates are starting to spike wildly again, and there are a bunch of people in the group shouting to take the other side and make some profit. I personally tend to be a bit more cautious: at times like these, I’m not afraid of the wrong direction, I’m more worried about being swept back and forth, earning the rate but not holding onto it long enough before it’s wiped out. To put it simply, I usually prefer to avoid volatility first, try a few small trades, hedge if possible, and avoid going all-in and holding through the swings.

Additionally, now everything from ETF fund flows to U.S. stock risk appetite is used to explain the rise and fall, which sounds quite reasonable, but when it actually hits the market, it often pierces through all logic like a needle... Anyway, I’d rather take it slow. When the rates are extreme, I either hold a light position to take the other side and set tight stop-losses, or just stay flat and watch the show. That’s how I’m doing it for now.