Ethereum whales bet on downside, but 73% traders are long – Who wins?

Ethereum remained stuck within a narrow range around $1.7k. While the altcoin consolidated over the past four days, it continued trading within a broader descending channel.

At press time, Ethereum [$ETH] traded at $1,736 after a modest 0.08% daily gain. While the market stabilized near $1.7k, whales remained cautious and continued positioning for downside.

Why are whales betting against Ethereum?

As Ethereum’s structure remained weak, demand for short positions surged among large holders.

According to Onchain Lens, the whale “pension-usdt.eth” increased its 3x leveraged $ETH short position to 50,000 $ETH, worth $85.28 million. Despite limited price movement, the position was already sitting on more than $1.43 million in unrealized profit.

Another whale also opened a 23,000 $ETH short position with 20x leverage, valued at $39.64 million. The trader later closed the position, locking in roughly $125,000 in profit.

The growing demand for short positions suggested that whales continued to expect another leg lower.

Even so, bearish bets faced mounting risks amid ongoing volatility.

Data from CoinGlass showed that $22 million worth of short positions were liquidated. That suggested the market continued to punish aggressive bearish positioning.

While whales leaned bearish, broader market positioning painted a different picture. The Long/Short Ratio climbed to 2.73. Around 73% of open positions were long, compared to 26% short.

That indicated most traders expected Ethereum to rebound despite recent weakness. This divergence left the market split between cautious whales and increasingly optimistic traders.

Can derivatives activity lift $ETH?

Despite rising derivatives activity, Ethereum’s broader market structure remained weak. That suggested capital flowing into derivatives markets was still insufficient to drive a sustained breakout.

The Directional Movement Index (DMI) reflected a lack of strong momentum. The negative directional indicator remained dominant, while the ADX hovered near 5.

That combination suggested neither buyers nor sellers held a decisive advantage.

As a result, Ethereum may continue trading sideways between $1.6k and $1.7k in the near term.

However, stronger demand in derivatives markets could increase liquidation pressure on shorts. If that occurs, $ETH may break above its current range, with $1,850 emerging as the next resistance level.

Final Summary