LIGHT is caught in a vortex of bullish and bearish battle, with a short squeeze quietly brewing.
LIGHT is at the heart of a fierce battle between bulls and bears, with market sentiment significantly divided. While many traders have chosen to short due to concerns about its rapid short-term rise, high funding rates, and potential market manipulation, deeper data reveals a potential short squeeze quietly taking shape.
Currently, funding rates remain in extremely negative territory, meaning short sellers are bearing high funding costs, which should theoretically suppress prices. However, LIGHT's price has shown remarkable resilience, rising against the trend and deviating from traditional expectations. On-chain data further confirms this anomaly: recent short liquidations far exceed long liquidations, with a large number of short positions being forcibly closed, exposing the vulnerability of the short side and providing strong upward momentum for the bulls.
Meanwhile, open interest remains stable, with no obvious signs of withdrawal. Combined with fund flows favoring the bulls and continuously increasing trading volume, this reflects strong genuine buying pressure in the market, indicating a bullish dominance is forming. These intertwined factors provide ample "fuel" for a potential further short squeeze.
It's worth noting that bearish sentiment is currently highly concentrated among retail investors. If the market chooses to break out against the trend, it could trigger a collective short covering, amplifying upward momentum. In the short term, LIGHT may experience an unexpected upward breakout due to polarized sentiment, potentially allowing bulls to open up new upside potential. $BTC
