Bitcoin Funding Rate Signals 54% Bullish Momentum Toward $112,000

CryptoQuant analyst AXEL Adler Jr has identified a recurring pattern in the 30-day percentile funding rate across major trading platforms, highlighting key market bottoms in September 2023, May 2024, September 2024, and April 2025. Each of these instances marked a pivotal local bottom followed by a sustained recovery and upward momentum. Following the April 2025 trough and a subsequent surge to $112,000, the current funding rate percentile stands at 54%, signaling continued bullish momentum in the crypto market.

This historical trend suggests that the market is approaching a critical threshold near the 80% funding rate percentile. Crossing this level could reflect heightened market exuberance, potentially increasing the risk of a corrective phase. Investors and traders should monitor these metrics closely to gauge market sentiment and adjust their strategies accordingly, ensuring they remain aligned with evolving market dynamics and risk parameters.

Bitcoin's funding rate, a critical indicator of market sentiment, has recently signaled bullish momentum, suggesting a potential surge toward $112,000. This pattern mirrors a historical instance in April 2025, where a similar funding rate preceded a significant price increase. Currently, the funding rate stands at 54%, indicating sustained bullish momentum in the market.

Bitcoin is currently consolidating around $107,000, with technical indicators suggesting a potential breakout to $120,000. The market sentiment has shifted positively, with a notable increase in long-side buy pressure. This bullish momentum is further supported by a favorable macroeconomic context, including record highs in US stocks, a weakening dollar, and aggressive fiscal policies. These factors are driving the bullish momentum, with Bitcoin benefiting fully from the favorable environment.

However, despite the bullish signals, there are signs of market overheating. The derivatives market sends a contradictory message, with funding rates declining on Binance, reflecting growing skepticism among traders. This misalignment opens the door to a possible short squeeze, where short sellers risk being crushed if the price breaks above $110,000 with force. Such a move can temporarily propel Bitcoin far beyond expectations.

The Fear & Greed Index also sounds the alarm, indicating that investors are in a state of great greed. Exuberance rises, clarity fades, and a typical short-term top configuration is forming. Bitcoin may be $2,000 away from a new all-time high, but in such a setup, the most spectacular rallies often come after a final shakeout. The $105,000 level could be that brutal, brief, and salutary shakeout.

For those looking for a strategic entry point, it’s better not to chase the price. For others, it’s time to lock in profits. Analysts predict a drop to $90,000 before a 10x rally, highlighting the potential for significant price movements in the near future. The current market dynamics suggest that Bitcoin is at a crossroads, with the potential for a breakout to new highs or a false start that could lead to a correction.