Ethereum Short Interest Hits Record Raising Liquidation Risk
Ethereum short interest has surged to a historic high of 18,438 leveraged contracts, marking the largest bearish bet in ETH’s history. This build-up increases liquidation risk if the price rallies and triggers a short squeeze. After slipping below the $4,300 support zone, ETH faces potential downside toward $4,000 or even $3,900 on a break below $4,200. However, institutional accumulation, declining exchange supply and growing ETF inflows provide strong bullish fundamentals. Traders are watching whether ETH can defend the $4,200–$4,250 demand level, which aligns with the 100-day moving average, before attempting a rebound toward the $4,500–$4,600 resistance range. With volatility elevated and open interest high, Ethereum short interest dynamics could dictate the token’s next major move.
Bullish
Despite short-term pressure and a test of the $4,200 support zone, Ethereum short interest at a record high sets the stage for a powerful short squeeze. Historical precedents show that extreme leveraged bearish positioning often triggers rapid upside when prices rebound. Coupled with strong institutional accumulation, shrinking exchange reserves and robust ETF inflows, the fundamentals remain solid. While a break below $4,200 could invite further declines toward $3,900, defending this level would likely spark aggressive buying and force shorts to cover. In both the near term and long term, these factors point to a bullish bias for ETH.