- The narrowing negative gap between Binance BTC perpetual and spot prices signals a possible shift in trader sentiment toward optimism.
- Historical patterns show that rising BTC prices amid negative funding often precede major bullish reversals in the crypto market.
- Despite the current negative gap, increasing momentum and red bars resemble past setups that led to significant BTC rallies.
According to analyst Joao Wedson, Bitcoin’s market structure is sending mixed yet intriguing signals. The gap between Binance’s perpetual futures and spot BTC prices remains negative. However, since late 2024, this gap has been steadily narrowing. Historically, a shrinking or flipping gap often hints at a shift in sentiment.
This perpetual-spot price gap is a key market sentiment indicator. A positive gap means futures trade above spot, suggesting bullish expectations. A negative gap, however, indicates caution and often reflects bearish bias. Significantly, the current narrowing gap comes while BTC trades around $70,000 to $80,000.
Market History Reflects a Pattern
The gap’s past behavior offers important insights. During early 2021, both spot and perpetual prices surged. Green bars appeared frequently, showing heavy buying in futures. BTC climbed above $60,000 as traders paid a premium for upside exposure.
By mid-2021, the bullish phase ended. The gap flipped negative, turning red as futures dropped below spot. BTC tumbled under $30,000. This marked a bearish reversal. Yet, the pattern wasn’t permanent. Late 2021 brought a recovery, pushing BTC near $50,000.
Throughout 2022, red bars dominated the chart. Perpetual prices consistently lagged spot, confirming bearish sentiment. BTC trended lower, reflecting macro weakness. Moreover, minimal bullish signals emerged during this phase.
In 2023, short bursts of green returned. These coincided with recoveries above $30,000. However, overall momentum stayed weak, with prices moving sideways. The futures market remained cautious despite brief optimism.
2024 Rally and Current Set-Up
Late 2023 into 2024 showed renewed strength. The gap turned green again as BTC jumped beyond $50,000. Perpetual traders regained confidence, fueling a bull cycle. BTC reached over $100,000 by early 2025 before correcting.
Now, the gap is back in negative territory. However, this isn’t necessarily bearish. The current setup mirrors mid-2021 — before a major rally. Blue arrows on the chart show rising price momentum despite negative funding. Additionally, deep red bars with climbing prices have historically preceded bullish reversals. Hence, the current price action could be the early stage of a trend shift.
