Market sentiment shift: The mainstream CEX funding rates indicate that the bearish trend has significantly weakened

Since the market gloom since early February, a glimmer of hope seems to have emerged today. According to Coinglass data, although Bitcoin (BTC) remains range-bound as it searches for direction, a key derivative indicator—the funding rate—is sending a markedly different signal: the bearish sentiment on major CEXs and DEXs has weakened.

What is the Funding Rate? Understanding the Market “Sentiment Gauge”

Before diving into the data, it’s important to understand what the funding rate is. It’s not a fee charged by trading platforms, but rather a mechanism for exchanging funds between long and short traders in the perpetual contract market. Its core purpose is to keep the contract price anchored to the spot price of the underlying asset.

In simple terms, the funding rate acts like a “sentiment gauge” for the market:

• When the funding rate is 0.01%, it’s generally considered a baseline rate.
• When the rate exceeds 0.01%, it indicates that bullish (long) forces are dominant, and longs pay shorts.
• When the rate is below 0.005%, it suggests that bearish (short) forces are strong, and shorts pay longs.

Data Interpretation: From “Extreme Bearishness” to “Weak Equilibrium”

Looking back earlier this week, the market was once engulfed in panic. Data shows that Bitcoin’s daily funding rate was negative for several days at the start of February, reaching its most negative level since May 2023. At that time, the 7-day simple moving average (SMA) turned negative for the first time in a year, reflecting an “overcrowded” short position.

However, as of February 13, this extreme situation is beginning to recover.

According to the latest Coinglass data, Bitcoin’s 8-hour average funding rate has rebounded to 0.0011%. While still low, this is a clear bounce back from deep negative territory.

This indicates that although some exchanges still show slight bearish bias (negative funding rates), the overall market’s one-sided short sentiment has significantly eased. Ethereum (ETH) shows a similar trend, with its 8-hour average funding rate at -0.001%, also near zero, indicating a weak balance.

Why Is “Diminished Bearishness” Worth Watching? Lessons from Historical Cycles

For traders, the recovery of the funding rate is important because it often signals a shift in market structure. Crypto analysts generally believe that sustained negative funding rates tend to occur during bottoming phases.

When the market experiences “consecutive days of negative funding rates,” it often means that too many traders are betting on further declines, creating an “overcrowded” short position. Such extreme positioning is usually not a continuation of the trend but a setup for a reversal. Once prices stabilize, these short traders eager to close positions may turn into buyers, triggering a short squeeze and accelerating a rebound.

Of course, history also teaches us to be cautious. Looking back to January 2022, long-term negative funding rates did not lead to immediate price reversals but instead foreshadowed a larger bearish cycle. Therefore, a rebound in funding rates is a positive sign but not an isolated reason to be bullish.

Market Overview: Current Anchors for BTC and ETH

While interpreting funding rates, we must also consider spot prices for a comprehensive view. As of February 13, 2026, according to Gate.io data, the crypto market is still undergoing “price restructuring”:

• Bitcoin (BTC) is at $67,300, down 1% in 24 hours, with a market cap of $1.31 trillion. The long-term sentiment remains optimistic.
• Ethereum (ETH) is at $1,972, down 0.8% in 24 hours, with a market cap of $233.26 billion. The market sentiment is “neutral,” showing resilience around the $1,950 support level.

After earlier corrections, BTC and ETH are demonstrating resilience at key levels. This price “range-bound” behavior combined with weakening bearish signals in derivatives markets characterizes the current market landscape.

On-Chain Data and Liquidity: A Glimmer of Caution

Beyond funding rates, we also need to observe real fund flows. On-chain data shows that the flow of stablecoins is a key indicator of market sustainability.

Although the 30-day change in USDT market cap turned positive at the start of January (+1.4 billion USD), it later fell back to -28.7 billion USD, indicating recent phased outflows. The SSR oscillator (measuring Bitcoin’s strength relative to stablecoins) remains in negative territory.

This suggests that while extreme bearish sentiment in derivatives markets is easing, the willingness for new capital to enter remains subdued. The market’s next move upward will heavily depend on whether sustained liquidity inflows occur.

Summary

In conclusion, the market data as of February 13, 2026, paints a complex picture:

1. Sentiment-wise, the funding rates on major CEXs and DEXs have recovered from deep negative levels to near zero, indicating that extreme bearish momentum has indeed diminished.
2. Price-wise, BTC and ETH are showing resilience at key levels, actively restructuring.
3. Fund flows show that stablecoin net outflows have not yet fully reversed, meaning a full-scale rebound may still be pending.

For investors, “diminished bearishness” does not mean “immediate bullishness,” but it at least suggests that the most panicked and overcrowded short phases may be over. In this current market environment of stockpiling positions, rather than guessing bottoms, it’s better to follow leading platforms like Gate and allocate assets such as GT, utilize yield-generating tools, and navigate cycles with a structural advantage, patiently awaiting the next clear trend.