A significant whale trader has opened a $44 million short position in Ethereum (ETH) at 10x isolated leverage, according to on-chain tracker Onchain Lens. The position was entered near $2,000 with a liquidation price set at $2,339.76. This bearish positioning comes as ETH is down more than 13% month-on-month, with the catalyst being Strategy's first Bitcoin sale in years, which broke the firm's long-held never-sell stance. The whale's bearish positioning was followed by another trader who moved approximately 5,000 ETH worth $9.8 million into Kraken as the price slid toward $1,960, potentially locking in losses of nearly $200,000. Latest data shows this selling pressure has intensified, with three large entities moving 21,101 ETH worth nearly $41.94 million to exchanges and deposit wallets, demonstrating rising whale selling pressure.
According to Santiment, ETH whale reserves excluding exchanges edged down from 125.02 million ETH on June 1 to 124.98 million the following day, representing a small but concerning shift from accumulation to distribution. On the Binance ETH/USDT perpetual contract, $1.82 billion in cumulative short liquidation leverage is stacked against roughly $781.93 million on the long side. The leverage picture shows the book is positioned bearish overall, with the $523.96 million in long leverage at the $1,930 zone remaining vulnerable to liquidation as price weakness continues. The overall Long/Short Ratio has declined to 0.97, indicating that short positions slightly outnumber longs across the broader market, with heavy short positioning potentially discouraging participation while increasing the possibility of a short squeeze if sentiment shifts suddenly.
Despite the bearish positioning, Hyperliquid flow data reveals a contrarian market response. Over the past six hours following the Strategy sale, Bitcoin absorbed net selling pressure worth $15.61 million, while ETH drew net buying pressure worth approximately $9.10 million. This divergence suggests traders are using the correlated weakness to bid ETH, which was never the direct story behind the Strategy announcement. The flow data indicates that while large holders are pressing the short side, quiet buyers are fading the selloff with conviction, potentially setting up a short-squeeze scenario given the heavily over-shorted book. The bearish tone has extended beyond spot markets into derivatives trading, with traders on Binance and OKX remaining relatively optimistic as exchange-specific ratios stayed elevated.
Ethereum has traded within a descending channel since its rejection near $2,300 weeks ago, and the altcoin has lost the key $2,000 support level, falling to a local low of $1,954. The Average Directional Index (ADX) has climbed to 44, while the Negative Directional Index (-DI) stands at 26, indicating strong trend strength rather than exhaustion. If selling pressure persists, ETH could retest lower support near $1,845. However, a recovery above $2,100 may force short sellers to unwind positions, potentially providing momentum for a broader rebound. The over-shorted book structure amplifies the potential impact of any sustained bid that could drag ETH back through $2,000, directly targeting the $44 million whale position and the broader short positions above it.
