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Conflux [$CFX] has declined by 11% in the last 24 hours, but several factors have been pulling against a clean bearish narrative. This, despite the steepness of the drop.
In fact, both the perpetual and spot markets seemed to be showing signs of buying activity and long trader dominance, creating a mismatch with the price action calling for measured caution.
Perpetual funding rates remain positive
At the time of writing, perpetual market data revealed the decline was not being backed by the funding rate – An anomaly worth examining.
Data from CoinGlass showed approximately $4.5 million in Open Interest capital exiting the market during this period, confirming negative sentiment feeding into the price.
On the contrary, the funding rate, which gauges whether long or short traders dominate the perpetual market, has remained positive.
A positive funding rate means long contracts outnumber short contracts, with long traders paying the funding fee.
At press time, the funding rate had climbed to 0.0058%, confirming that long traders held the majority of the positioning in the market. This was an anomaly though given that long traders absorbed $253,000 in losses over the same period.
Binance top traders push $CFX
There is likely a connection between the positive funding rate and the positioning of Binance’s top traders.
For instance – Data showed that Binance top traders, measured by both account size and position size, have been leaning bullish on $CFX while recording significant buying volumes.
The long-to-short ratio by position size moved up to 2.21, while the ratio by account size hit 1.23.
A reading above 1 indicates more long volume in the market, while a reading below 1 signals short trader dominance.
This positioning seemed to run contrary to the broader trading sentiment in the market. The same has been bearish for the most part, with the overall Binance long-to-short ratio sitting at 0.94.
This suggested that only a small segment of traders may be driving the bullish lean that has been observed, with a majority of the market not in alignment with the same.
Spot buyers add $229,000 this week
Finally, spot traders are also actively accumulating $CFX, adding another layer to the mixed market picture.
Since 17 May alone, spot traders have acquired $229,000 worth of $CFX from the market, building on the previous week’s $11 million in spot net inflows.
This buying activity is evidence of genuine accumulation interest at press time price levels.
And yet, the Accumulation/Distribution indicator shared a more cautious story. It flagged approximately 1.54 billion in $CFX distribution volume, indicating that traders may be selling aggressively in aggregate.
With buying conviction present in pockets of the market but distribution dominating the overall volume picture, traders on both the long and short side might have clear reason to proceed with caution.
Final Summary
- Conflux declined by 11%, but the perpetual funding rate held positive at 0.0056% with Binance top traders by position size recording a long-to-short ratio of 2.23.
- Spot buyers scooped up $229,000 worth of $CFX this week alone, following $11 million in net spot inflows the previous week.
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