The old dog just finished sweeping
$EWY ’s options order book, and this bearish candle has a certain smell. In the past 24 hours, it’s down 7.218%. The current price is 166.46. Trading volume has swelled to 224 million. Open interest is 169 million. The funding rate is 0.0584%—positive. The longs are still paying wages to the shorts. When it drops this much but the funding rate can’t be pushed down, what does that mean? The long side holding the position hasn’t shown any sign of backing down; instead, they’re adding as it falls—or else it dropped so fast they couldn’t get out in time. This kind of structure, the old dog has seen too many times. Underneath, there’s often another leg.
Today there aren’t any other comparable reference targets. In the entire TRADIFI sector, only
$EWY is putting on a one-man show—there’s not even a shadow from the like-for-like Korean or emerging-market ETFs. Without reference points, you have to watch that funding rate “monster-revealing mirror” even more closely. A healthy positive funding rate means longs are crowded. If price falls and the funding rate stays positive, it means trapped longs are bleeding while topping up margin—open interest may not drop and could even get jacked higher. If that 1.69 million OI keeps stacking, and once it breaks another key level, it could trigger a chain liquidation—this stampede won’t be just guesswork. On the order book, around 165 is the spot bid/support area from the last sharp selloff; it’s also where many perpetual longs have their last breath. Looking at it, if 165 fails, below it may go straight to 160 to find volume.
Some people in the market say this is a buying-the-dip opportunity. The Korean index hasn’t seen any substantive negative news, and foreign capital outflows are just惯性. I don’t disagree with that narrative, but if you step in now to pick up a bargain, it’s like catching a falling knife that’s still dropping. And the funding rate is still being deducted from your account every day. Even if it later bounces, the time cost alone will be enough to make you suffer. My personal stance is very clear: observe with a light position, and don’t actively add longs. If
$EWY breaks below 165 and the funding rate stays this stubbornly hard, the old dog will directly cut the existing spot holdings, and open a perpetual hedge short to eat the funding rate back. The opposite trigger is simple too: once it reclaims 170 and the funding rate falls back to below 0.01% or even turns negative, then that’s when it shows longs have truly surrendered cleanly—and you can get back on the train. The consensus we disagree on is that I don’t think this move will simply replicate last November’s script. Back then, it also fell hard and then rebounded hard, but macro liquidity was far more abundant. Now, with the world still tightening at the tail end, don’t fight for too long.
The last time I watched a similar funding-rate structure was early December last year. It held positive funding for almost three weeks—profits were all used to pay interest, and in the end it exited at breakeven. The old dog’s old skin has not been immune to getting farmed either. I’ve learned the lesson.
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