Ethereum is seeing a notable shift in derivatives positioning as highly leveraged long positions decline sharply across the globe. walk. This reduction suggests that many overly aggressive bullish trades were either closed voluntarily or forced to exit following recent liquidation events.
Could Ethereum be preparing for a short squeeze next?
Crypto investor and data analyst known as CW on X underlines that Ethereum is going through a significant deleveraging phase as highly leveraged long positions continue to decline significantly in the market. At the same time, short positions increased slightly, indicating that the market is not yet heavily crowded on the bear side.
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The overall scale of highly leveraged exposure remains relatively low, suggesting reduced systemic risk compared to earlier phases. Furthermore, most of the greedy long positions have already been liquidated, with the next focus now being on short position liquidations.
Amid this market phase, Ethereum whales are showing behavior not seen in over a year, potentially signaling a major shift in market dynamics. An analyst known as Ali Charts has revealed that since October 6, 2025, wallets holding between 1,000 and 10,000 ETH have undergone a significant regime change in their market behavior.
Before this change, this cohort was in a stable accumulation regime. Between April and October 6, 2025, their holdings increased from approximately 12.95 million ETH to almost 15.95 million ETH. million ETH. However, this trend has today been significantly reversed.
Since October 6, the holdings of these mid-tier whales have increased from 15.95 million ETH to approximately 12.52 million ETH, an increase of 21.5%. decline in their total position.
With a significant amount of supply entering the market via whale distribution, any sustainable move towards the $3,000 level may now depend on a new wave of institutional or retail demand capable of absorbing this selling pressure.
Relative weakness of Ethereum compared to Bitcoin
Ethereum continues to show signs of weakness against Bitcoin, with recent market actions reinforcing a more fragile short-term structure. Crypto trader KriptoHolder also note as selling pressure on ETH intensified, pushing prices lower towards the $2,273 region.
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At the same time, retail traders remain heavily tilted to the long side, with around 73.19% of them positioned bullish, while shorts hold positions at around 26.80%, reflecting a crowded trade that often becomes vulnerable during downturns. However, the Whales vs Retail Delta currently sits at -22.01, showing that the whale side continues to apply significant selling pressure.
According to KriptoHolder, ETH is likely to see two major changes: a reduction in aggressive selling on the whale side and the return of significant buying in the spot market. supportbefore a stronger upward rebound becomes possible. For now, ETH appears stuck in a more vulnerable position, with market internals showing less resilience than BTC.
Featured image from Getty Images, chart from Tradingview.com
