So last night was pretty crazy.
And then I wake up to everything being covered in snow.
It's a Christmas Miracle you guys.
I watched in real time as my short triggered at $100700. The short squeeze I was predicting took us to $100715 so my order barely got filled. Then immediately the price crashed to $100k and the position was up $80. I Tweeted about it and wondered if I should just take the money and run because who knows what's going to happen. Shortly after that we spiked to $104500 and my stop-loss was sitting at $105k... so I was very close to immediately losing my $400. I doubled down the short there fully expecting for the stop-loss to liquidate the position, but when I woke up in the morning the price was basically in the same exact spot.
I ended up liquidating the position at around $102700 for a $100 loss. Not too bad. The market simply didn't do what I was expecting it to do. What I wanted and expected was a March 5th $69420 situation where we get an immediate flash-crash into a V-shaped recovery. That didn't happen so I closed the position. Seconds after doing so price started pumping again and I was glad to be out of the short and back to my absurdly hyperbullish antics.
Someone I barely know just texted me a bunch of questions about buying into crypto.
So it begins.
Crazy day.
https://x.com/edict3d/status/1864708154849697888
What a whirlwind this is turning into. I reopened my short because longs were paying the shorts 80% APR and idiot degens put their liquidation point at $101k instead of $99k. Rode down the short from $103k to $101k and now find myself in the green $50 on this trade. I may take a little break from day trading because it's all happening so fast.
When the funding rate gets very high it essentially guarantees that the price is coming down one way or another. The funding rate happens every 8 hours which is 1095 times a year. So if we multiply these numbers by x1095 we get the APR. In this case I saw that the APR for shorts was sitting at 0.0728% last night which is 79.7%. That's an insane yield to earn as a short. Imagine being given the opportunity to farm 80% on USD. Basically when the funding rate gives better gains than Bitcoin itself it guarantees that price is coming down. This is how I was able to get my money back on the short plus a little extra just now. The APR is now 52% which is still very high so it will probably keep dipping, but I won't reopen my short unless we get another pamp.
However I still think after all this silly leverage is gone it's off to the races. The cat is out of the bag. Everyone knows that $100k is just a stepping stone to a much higher number, and proof that $100k can happen is all a lot of us needed for that extra boost of momentum.
https://www.coinglass.com/FundingRate
I found a funding rate chart on Coinglass just now and it gives a lot of great insight into how irrational bulls are being in this moment. The funding rate is still sky high and due for more correction. Market makers are being paid a small fortune to keep the books balanced. Which side will you be on?
It's pretty awesome that we hit $100k before year's end, but we still need to go much much higher for metrics like the doubling curve to come back into play. And we will go much much higher... it's just a matter of wen. But first we need to flush all this degenerate leverage out of the system and let both sides recover. It's been a day. Take it easy.
