Bitcoin Price Breaks $71,000: Will This Rally Continue?

After prices soared to $73,800 in March, the coin has been consolidating horizontally and even worryingly dipping to as low as $56,500 in May.

Bitcoin price has soared to above $71,000. After consolidating for two months, the coin appears to be preparing for a breakout. However, a closer look at exchange activity reveals a potential cause for concern: There is a lack of bullish conviction in the Bitcoin futures market.

One analyst examines the perpetual funding rate, a key indicator of sentiment among futures traders, and notes that it is uncharacteristically low despite rising prices.

While currently positive, the funding rate falls significantly short of levels seen in the last leg up to January 2024 when spot Bitcoin ETFs were approved. It is also way lower than when BTC rose to all-time highs in March 2024.

All Eyes On The Bitcoin Funding Rate

The funding rate is a crucial concept on platforms like Binance or Bybit, which allow the trading of BTC perpetual futures.

It is a payment reset every eight hours and exchanged between long (bullish) and short (bearish) positions in a perpetual futures contract.

The price differential between the perpetual Bitcoin futures price (an index) and the spot rate determines whether the funding rate will be positive or negative.

When positive, it means the perpetual BTC futures price is higher than the spot rate.

In this event, as is currently the situation, leveraged traders initiating long positions have to pay a fee to sellers. In essence, bulls are paying a premium, anticipating more price gains.

The higher the positive reading of the funding rate, the more bullish the crowd is.

Bitcoin Price At Key Resistance: Will This Breakout Fail?

After prices soared to $73,800 in March, the coin has been consolidating horizontally and even worryingly dipping to as low as $56,500 in May.

Millions of dollars’ worth of leveraged longs were liquidated in the process. However, in early June, things are looking up for Bitcoin.

Earlier today, the coin broke $71,000 and looks likely to break a key liquidation level at $72,000.

(BTCUSDT)

However, not everyone is convinced that this rally will last. A closer look at exchange activity reveals a potential cause for concern: There is a lack of bullish conviction in the Bitcoin futures market.

One analyst examines the perpetual funding rate, a key indicator of sentiment among futures traders, and notes that it is uncharacteristically low despite rising prices.

While currently positive, the funding rate falls significantly short of levels seen in the last leg up to January 2024 when spot Bitcoin ETFs were approved. It is also way lower than when BTC rose to all-time highs in March 2024.

Bitcoin Price At Key Resistance: Will This Breakout Fail?

After prices soared to $73,800 in March, the coin has been consolidating horizontally and even worryingly dipping to as low as $56,500 in May.

Millions of dollars’ worth of leveraged longs were liquidated in the process. However, in early June, things are looking up for Bitcoin.

Earlier today, the coin broke $71,000 and looks likely to break a key liquidation level at $72,000.

(BTCUSDT)

However, not everyone is convinced that this rally will last. A closer look at exchange activity reveals a potential cause for concern: There is a lack of bullish conviction in the Bitcoin futures market.

One analyst examines the perpetual funding rate, a key indicator of sentiment among futures traders, and notes that it is uncharacteristically low despite rising prices.