Ethereum Could Trigger Short Squeeze as $10B in Shorts Face Liquidation Amid Whale Buying and Waning Bearish Momentum

Ethereum short squeeze risk is rising as over $10 billion in ETH shorts face liquidation if price climbs toward $4,359; shrinking bearish momentum, rising whale accumulation, and negative funding rates set the stage for rapid short-covering and volatile upside moves. Over $10B in ETH shorts at risk near $4,359 Whale buys (Bitmine ~234,846 ETH) and fading bearish indicators suggest weakening downtrend. Key technicals: RSI ~45 (neutral), DMI shows declining –DI; 20/50 EMAs act as immediate resistance. Ethereum short squeeze: ETH shorts >$10B near $4,359; monitor funding rates, whale flows, and key EMA breaks for a potential breakout — read now. Is Ethereum about to trigger a short squeeze? Ethereum short squeeze probability has increased as a large pool of leveraged short positions sits vulnerable near the $4,359 level. Reduced bearish momentum, negative funding rates and significant whale accumulation raise the odds of a cascade of liquidations if buyers sustain upward pressure. What evidence shows traders may be ignoring bullish signs? Funding rates stayed negative last week, indicating persistent short-side conviction. Meanwhile, on-chain monitoring platforms reported elevated whale purchases and large exchange outflows. Bitmine’s reported purchase of 234,846 ETH (approx. $963M) enlarged a top holder’s supply, signaling accumulation by smart money despite public pessimism. { "@context": "https://schema.org", "@type": "NewsArticle", "mainEntityOfPage": { "@type": "WebPage", "@id": "https://en.coinotag.com/eth-short-squeeze-analysis-2025-09" }, "headline": "Ethereum Shorts Top $10B — Is a Short Squeeze Imminent?", "image": [ "https://en.coinotag.com/wp-content/uploads/2025/09/M0C6k1Dj_58eb1cbaf69dc8df7004dc58f9cdf854d5108488efe29e619d494ed0f36217b5.webp" ], "datePublished": "2025-09-30T09:00:00Z", "dateModified": "2025-10-01T06:00:00Z", "author": { "@type": "Organization", "name": "COINOTAG" }, "publisher": { "@type": "Organization", "name": "COINOTAG", "logo": { "@type": "ImageObject", "url": "https://en.coinotag.com/wp-content/uploads/2024/01/coinotag-logo.png" } }, "description": "Ethereum short squeeze risk rises as more than $10 billion in ETH shorts face liquidation pressure near $4,359 amid whale accumulation and fading bearish indicators."} { "@context": "https://schema.org", "@type": "FAQPage", "mainEntity": [ { "@type": "Question", "name": "How much in ETH shorts is at risk?", "acceptedAnswer": { "@type": "Answer", "text": "Over $10 billion in open ETH short positions are vulnerable to liquidation if price pushes toward the $4,359 zone, based on on-chain derivatives data and exchange open interest snapshots." } }, { "@type": "Question", "name": "What on-chain signs indicate a potential squeeze?", "acceptedAnswer": { "@type": "Answer", "text": "Key signs include large whale buys, exchange outflows, negative funding rates consistent with heavy shorting, and concentrated stop levels near $4,300–$4,400." } } ]} { "@context": "https://schema.org", "@type": "HowTo", "name": "How to monitor a possible Ethereum short squeeze", "description": "Practical steps to track indicators that could trigger an ETH short squeeze.", "step": [ { "@type": "HowToStep", "name": "Track funding rates", "text": "Monitor perpetual swap funding rates for spikes from negative to less-negative or positive, which signal increasing buyer pressure." }, { "@type": "HowToStep", "name": "Watch whale flows", "text": "Follow large on-chain transfers and exchange outflows indicating accumulation by large holders." }, { "@type": "HowToStep", "name": "Monitor technical levels", "text": "Observe price reaction at the 20- and 50-day EMAs and key resistance around $4,300–$4,400 for potential liquidation cascades." } ]} Frequently Asked Questions What triggers a short squeeze in Ethereum? A short squeeze is triggered when price rises quickly, forcing leveraged short positions to cover (buy) to close losses. In ETH’s case, clustered stops and high open interest near $4,359 could create cascading liquidations and sharp upside moves. How should traders manage risk around a potential squeeze? Use defined position sizes, set protective stops below key support, avoid heavy leverage, and monitor funding rates and whale activity to reduce unexpected liquidation risk during volatile moves. Key Takeaways Large short exposure : Over $10B in ETH shorts creates vulnerability near $4,359. Smart money accumulation : Significant whale buys and exchange outflows suggest accumulation by large holders. Technical setup : RSI at neutral, fading –DI on DMI, and price near 20/50 EMAs — breakout depends on sustained buying pressure. Market snapshot and technical context At press time, Ethereum traded around $4,173 after a modest rebound. RSI sat near 45, indicating neutral momentum. The DMI showed declining bearish strength as the –DI began to flatten against the +DI. Price action remains capped by the 20 and 50-day EMAs, which now serve as critical decision points for bulls and bears. Funding rates remained negative through last week, reflecting a dominant short bias — a condition that historically precedes squeeze dynamics when buyers step in. On-chain analytics providers and derivatives aggregators (reported by CryptoQuant and exchange interest trackers) show concentrated leverage levels and clustered short positions in the $4,300–$4,400 band. Whale activity further supports the thesis. Bitmine’s reported purchase of roughly 234,846 ETH (reported value ~ $963M) increased top-holder balances, suggesting accumulation by entities prepared to hold through volatility. Source mentions: CryptoQuant, TradingView, X (all cited as plain text, no external links). Ethereum [ETH] might be on the edge of something big, and short sellers are sweating. Over $10 billion worth of ETH shorts are now hanging by a thread. If price breaks toward the $4,359 mark, it could spark a liquidation cascade that sends ETH flying. The recent downtrend looks like it’s losing steam, and bullish momentum is rising. Where do we go from here? Fear in the air, but ETH is unfazed Despite the gloom in the market, Ethereum’s starting to push higher, and that’s no coincidence. Funding Rates stayed negative throughout last week, meaning traders were paying to stay short. That kind of bearish sentiment often shows up right before a reversal. Source: Cryptoquant And it’s not just the charts, whales are moving too. Just yesterday, Bitmine bought a jaw-dropping 234,846 ETH (worth $963 million), bringing their total stash to over $10.8 billion. Source: X $10B in shorts and they’re on thin ice When a market is heavily shorted and whales begin to accumulate, open interest concentrated at clear levels becomes the fuel for a rapid squeeze. If ETH breaches the $4,300–$4,400 zone, stop-losses and liquidations could force short covering that exacerbates upside momentum. Waning bearish pressure Ethereum’s intraday price action hovered below the 20- and 50-day EMAs, which act as resistance and short-term trend gauges. A decisive close above these EMAs with increased volume would be a technical signal confirming buyers are taking control. Source: TradingView Conclusion Ethereum’s setup — concentrated short interest, negative funding rates, rising whale accumulation and weakening bearish momentum — increases the chance of a short squeeze if buyers sustain a march toward $4,359. Traders should monitor funding rates, exchange flows and EMA breaks for actionable confirmation. COINOTAG will continue to track real-time data and updates.