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Ethereum, the second largest cryptocurrency by market capitalization, had a lackluster 2024, underperforming Bitcoin and many altcoins throughout the year. However, as 2025 begins, Ethereum begins to show signs of recovery, gaining over 10% in less than a week. The early rise has renewed hope among investors and analysts who see the potential for strong performance this year.
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Analyst Maartunn recently shared insightful data highlighting an ongoing trend of aggressive short selling in Ethereum markets. According to Maartunn, seller-takers dominate the market, outpacing buyer-takers by more than $350 million per day. This aggressive short selling could explain Ethereum’s poor performance in 2024, as consistent selling pressure has likely suppressed bullish momentum.
With the optimism of the new year, many believe this short selling trend could begin to change, creating the conditions for Ethereum to reclaim its market leadership position. As the altcoin leader overcomes its challenges, the coming weeks will be crucial in determining whether this initial rally marks the start of a more sustained uptrend. Investors are closely watching Ethereum, anticipating that a reversal of these bearish trends could lead to a banner 2025 for the network.
Ethereum Rising Amid Aggressive Short Selling Trends
Ethereum is attempting to surpass its 2024 high, but a decisive breakout remains elusive. Recent price action indicates the potential for a rally, with ETH posting early gains in 2025. However, the path forward is unclear as significant selling pressure continues to weigh on the leader. altcoin.
Leading analyst Maartunn recently shared insightful data from CryptoQuant, shedding light on current market dynamics. According to the data, Ethereum is experiencing aggressive short selling with seller-takers dominating trading activity. Over $350 million more selling pressure than buying activity is being recorded daily, creating a difficult environment for ETH to break free from its current range.
This trend, even if it lowers prices in the short term, cannot last indefinitely. Market cycles often view these aggressive short sales as a precursor to a reversal, as sellers run out of steam and buying pressure begins to build. Long-term investors would view this phase as an opportunity, positioning themselves to capitalize on Ethereum’s relatively low prices.
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As Ethereum moves through this dynamic, the next few weeks will be crucial. A clear break above last year’s high could signal the start of a broader rally, sparking renewed interest and potentially reversing the current short-selling trend. For now, ETH remains at a pivotal moment.
Price test at crucial levels
Ethereum is trading at $3,650 after a robust start to 2025, gaining ground early in the year. Price recently broke above the 200 4-hour EMA level with impressive strength, a technical indicator often considered a critical threshold for long-term trends. ETH is currently testing the 200 MA over the same time frame, a level that could confirm the uptrend if recovered and held as support.
A strong daily close above 200 MA would solidify Ethereum’s bullish momentum, potentially setting the stage for a massive rally to challenge and surpass last year’s highs. Such a move would likely reinvigorate market sentiment and attract additional buying pressure, pushing Ethereum to new levels in the near term.
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However, the bullish outlook is not without risks. If Ethereum fails to hold the 200 MA as support, the market could witness another round of selling pressure. This would likely push ETH to lower levels, eroding recent gains and prolonging its battle to regain upward momentum.
Featured image of Dall-E, chart by TradingView
