Currently, the BTC funding rate on most platforms is around 0.01%.

This is the baseline level for the funding rate.

It suggests that longs are willing to hold positions,

but the advantage isn’t obvious.

ETH is relatively stronger.

Many platforms’ funding rates have already stabilized above 0.005%,

indicating that the speed at which sentiment is recovering for ETH is faster than for BTC.

However, there is still some distance from a truly unanimous long position expectation.

I actually think this state is healthier.

If the funding rate suddenly spikes very high,

it means the market is broadly in agreement that it will keep going up, leverage is getting heavier,

and that can make long liquidation stampedes more likely.

If the funding rate stays negative for a long time,

it means the market is overly pessimistic.

And now,

the funding rate has returned to around neutral.

This shows that:

shorts aren’t as aggressive as before,

and longs aren’t wildly adding leverage.

The market is waiting for a new catalyst.

So don’t think the bull market is back just because the price rises a little;

and don’t assume the trend has completely reversed just because the funding rate turns positive.

The funding rate can only tell you that sentiment is changing; it cannot replace the trend.