$ALPACA Whats Going On ?

ALPACA Rallies 440% on Binance Delisting News — How a Bearish Headline Sparked a Bullish Run

On April 24, Binance announced it would delist four tokens, including ALPACA, on May 2.

Such negative news often causes a price decline, but that was not true for ALPACA.

On the contrary, the price increased gradually after the news and went parabolic on April 29.

This article will examine why this happened and whether the ALPACA price increase will continue.

ALPACA Pumps After Delisting

One potential reason for ALPACA pumping on the negative delist news is the update on the funding rate settlement.

On the same day as the news, Binance announced that it would increase the funding rate settlement frequency of Alpaca futures contracts to every two hours, capped at a negative and positive 2%.

The funding rate change considerably affects how much users earn for holding a position open, based on whether it is negative or positive.

At the time, the funding rate was negative, causing short traders to pile up positions and profit from the funding rate.

However, the opposite happened since buyers pushed the price up and triggered a cascade of liquidations.

This announcement was the catalyst for the first ALPACA price increase.

On April 29, the funding rate cap was changed from -4 to 4%, triggering another significant price increase for the same reason.

An X user noted the trend of low-cap tokens pumping at delist news. He believes whales set a trap by opening huge futures longs and pumping the spot price, triggering liquidations.

With this strategy, whales profit from the price increase and funding fees.

Will ALPACA Continue Rallying?

The ALPACA technical analysis shows that the price started a five-wave upward movement on April 17, before the delisting news.

ALPACA started wave three and accelerated its upward movement on April 24.

Wave five has extended and is longer than waves one and three combined, usually the level where the extension of wave five ends.