When the funding rate hits an extreme, my first reaction isn't "buy in," but rather to look at what I'm actually betting on: whether it's a mean reversion or a trend continuation. To put it simply, no matter how exaggerated the rate is, it's just an emotional tax; what's truly dangerous is volatility pushing you out of the market. Most of the time, I prefer to hide, turn down the leverage a bit, and wait until it goes from "everyone is on the same side" back to normal breathing before acting.

These days, some people are again interpreting large on-chain transfers and unusual activity in exchange hot and cold wallets as signals of "smart money," and I do look at that too, but only as noise filters: it can remind you that the market is tense, but it doesn't mean the direction is written in the transfer notes... Sometimes I really get annoyed by this over-interpretation. Anyway, what I care more about now is: if I take the opposite position, can I sleep well knowing my maximum loss; if not, I won't do it, and missing out is okay too.