1. What Is a Funding Rate?
The funding rate is a fee periodically exchanged between long and short positions to align perpetual futures prices with spot prices.
📊 Interpretation
Positive funding (+): Longs pay shorts → longs are overheated → a decline is possible.
Negative funding (-): Shorts pay longs → shorts are overheated → a rise is possible.
Baseline: 0.01%, every 8 hours, or 3 times a day.
2. Extreme Funding Rates
⚠️ Overheating Signals
+0.1% or higher: Extreme overheating on the long side. Watch for a decline.
-0.1% or lower: Extreme overheating on the short side. Watch for a rise.
Extreme funding → the cost of opposing positions is very high
→ eventual liquidation → a sharp move in the opposite direction.
3. Where to Check Live Rates
- Coinglass — A dashboard of funding rates by exchange.
- Binance — Check directly on the futures trading screen.
- Bybit — Check the contract details.
4. How AI Uses Funding Rates
NOONOO TRADING includes funding rates among its trading inputs. With extreme funding, the expected value of an opposing position increases.
🃏 AI That Detects Market Overheating
See AI analysis that combines funding rates with other factors.
Start in the bot