Old Dog just checked the on-chain contract for $MU , priced at 887.93, and in the last 24 hours, it’s been shorted by 12.82%. The volume's not small, over a billion, but this bearish candlestick has pushed the funding rate to 0.00049, still a positive number, and the open interest (OI) is hanging at 90411, not budging. What does this indicate? The bulls are still holding strong, averaging down as it dips, paying the funding fee like it's nothing. Old Dog has been watching these TradFi mirrored contracts for two weeks and feels a bit of the vibe from the tech stock flash crash back in March. But unlike that crash where it bounced back after two days, the bulls' conviction is even heavier now.
The crypto market’s emotions have been increasingly tangled with the US stock market over the past six months. The semiconductor sector coughs on NASDAQ and the on-chain US stock contract pool shakes along, with $MU being a storage chip proxy, naturally sensitive to BTC liquidity. Some folks think that when the crypto market drops, these stock contracts should be dumped, but the data tells a different story. What I'm mainly watching is the turnover of holding addresses. The concentration in top wallets isn’t extreme, but the trading frequency of the top 50 addresses in the last three days has doubled compared to last month, with big wallets slowly distributing to retail investors. When viewed in conjunction with the funding rate, this is a typical bullish crowded structure; in the downtrend, the funding rate equals the fee the bulls pay for protection, getting more expensive as it drops, until someone breaks first. If BTC can’t hold the integer level in the next few days, the liquidation on $MU will be like a domino effect, because the OI hasn’t decreased much, indicating leverage is still tight.
Old Dog's take is straightforward: at this position, I'm not bottom-fishing or catching falling knives. The trigger conditions are for $MU to break below 850 with a volume increase and OI decreasing over 15%, then I might consider a small position to long; otherwise, in a bearish trend, a positive funding rate is just a signal for getting rekt. Contrary to market consensus, many believe it’s due for a bounce after such a drop, but I disagree for a simple reason: without the funding rate turning negative and OI flushing out some weak hands, the market makers have no motivation to pump it. I’ve got half my position sitting in USDT, waiting for the day the funding rate flips negative. Don’t talk to me about sector rotation; with this rate of decline, the only players are stop-losses and stubborn holdouts.
Last round, I actually got burned on $MU ; back then, the funding rate was high, and I foolishly added to my position, only to get wrecked after three days of drops, looking back and realizing I became a liquidity sacrificial lamb. Old Dog can also get bitten by the stocks he's been watching for half a month—paying tuition is just part of the game.
Trading tags: #BinanceFutures #TradFi #USDⓈM #MU #MUUSDT $MU
The crypto market’s emotions have been increasingly tangled with the US stock market over the past six months. The semiconductor sector coughs on NASDAQ and the on-chain US stock contract pool shakes along, with $MU being a storage chip proxy, naturally sensitive to BTC liquidity. Some folks think that when the crypto market drops, these stock contracts should be dumped, but the data tells a different story. What I'm mainly watching is the turnover of holding addresses. The concentration in top wallets isn’t extreme, but the trading frequency of the top 50 addresses in the last three days has doubled compared to last month, with big wallets slowly distributing to retail investors. When viewed in conjunction with the funding rate, this is a typical bullish crowded structure; in the downtrend, the funding rate equals the fee the bulls pay for protection, getting more expensive as it drops, until someone breaks first. If BTC can’t hold the integer level in the next few days, the liquidation on $MU will be like a domino effect, because the OI hasn’t decreased much, indicating leverage is still tight.
Old Dog's take is straightforward: at this position, I'm not bottom-fishing or catching falling knives. The trigger conditions are for $MU to break below 850 with a volume increase and OI decreasing over 15%, then I might consider a small position to long; otherwise, in a bearish trend, a positive funding rate is just a signal for getting rekt. Contrary to market consensus, many believe it’s due for a bounce after such a drop, but I disagree for a simple reason: without the funding rate turning negative and OI flushing out some weak hands, the market makers have no motivation to pump it. I’ve got half my position sitting in USDT, waiting for the day the funding rate flips negative. Don’t talk to me about sector rotation; with this rate of decline, the only players are stop-losses and stubborn holdouts.
Last round, I actually got burned on $MU ; back then, the funding rate was high, and I foolishly added to my position, only to get wrecked after three days of drops, looking back and realizing I became a liquidity sacrificial lamb. Old Dog can also get bitten by the stocks he's been watching for half a month—paying tuition is just part of the game.
Trading tags: #BinanceFutures #TradFi #USDⓈM #MU #MUUSDT $MU