Ethereum Targets $4 Breakout – But Brace for Liquidation Storm

Ethereum bulls are charging toward the $4 psychological barrier—yet leveraged traders might regret their enthusiasm.

Liquidity crunch incoming?

The push toward $4 smells like a classic bull trap. Shorts get squeezed, overconfident longs pile in, then—wham—the market flips. Cue the cascade of liquidations. (Bonus jab: Wall Street’s ‘risk management’ teams will pretend they saw it coming.)

Active traders, watch your leverage. Hodlers, grab popcorn.

Ethereum is turning heads once again, and this time it is because the price has surged toward the crucial $4,000 mark. Currently priced at $3,933.77, this largest altcoin by market cap has added over $474 billion to its valuation. This has been influenced by strong institutional flows and technical momentum. With trading volume shooting up a remarkable 26.18% to nearly $30 billion. Could this be the breakout moment ethereum bulls have been waiting for? Or will the FED meet decide ETH’s next move?

Institutional Bets Grow Louder

Let’s get into on-chain, Ethereum CME Futures open interest has surged to a historic high of $7.85 billion. This rapid growth in open interest signals strong speculative activity in the crypto market and amplified institutional involvement. This is a trend often associated with upcoming price volatility.

Successively, each spike in open interest aligns with price appreciation, highlights that Leveraged long positions are dominating. If Ethereum breaches above $4,062, roughly $1.31 billion in short positions could be liquidated. This could trigger a cascade of buy orders. Conversely, a dip below $3,687 puts $2.9 billion in long positions at risk, showing just how uncertain yet powerful the current positioning is.

Ethereum Price Analysis:

ETH price at the time of press is changing hands at $3,933.77 after brushing an intraday high of $3,934.75. Looking at indicators, the RSI sits at an overbought level of 72.03, while the price continues to ride the upper Bollinger Band. If bulls break through the $4,096.82 resistance zone, Ethereum could rally further toward fresh yearly highs.

However, a failure to maintain current levels could trigger a quick correction to support at $3,687, then to $3,585 or even $3,550 if selling pressure intensifies.

FAQs

The ETH price is going up in view of the $295 million ETH acquisition by SharpLink Gaming and over $1.85 billion in net inflows into Ethereum spot ETFs last week.

The price of 1 ETH at the time of press is at $3,933.77 with an intraday change of +3.61%.

Yes, falling below $3,687 could trigger $2.9B in long liquidations, intensifying downside pressure.