Recently, when I look at on-chain settlement and liquidation data, it feels like the “red line” in lending isn’t really a single line—it’s a dense zone. When you’re still three steps away, things are actually the quietest: everyone just keeps adding to their positions, and no one thinks they’re going to get swept up. But when you’re down to two steps, or one step, liquidity suddenly drops off a cliff.

My habit is: when I see funding rates at extreme levels plus lending rates that are relatively high, I don’t rush to bet on a reversal. Even if it means making a bit less, I adjust my position size and widen the liquidation distance. I’d rather have slightly lower returns than be taken out by one wave.

Afterward, those who say, “You should’ve run earlier,” are often the ones who, at the time, refused to leave no matter what.