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Due to ETH's abrupt breakout, which resulted in nearly $3 billion in cryptocurrency liquidations and heavily penalized short positions, one of Ethereum's most prosperous high-leverage traders experienced a severe reversal.
History doesn't guarantee the future
During the trade, the trader known as pension-usdt.eth reportedly lost about $49 million, ending an incredible 23-trade winning streak. The account's reputation was largely established through its successful shorting of Ethereum, so the most recent loss was especially noteworthy: when ETH suddenly moved against it, the same strategy that had produced frequent wins became very costly.
Over 172,000 traders were impacted by the $2.99 billion in leveraged positions that were liquidated throughout the cryptocurrency market in a single day. In contrast to the $256.5 million in long liquidations, shorts accounted for approximately $2.74 billion.
This indicates that traders who were positioned for lower prices accounted for more than 91% of the liquidated capital. Second only to Bitcoin at $1.42 billion, Ethereum alone accounted for about $1.13 billion in liquidations. The scale can be explained by the violent price action of ETH.
Solid reversal
Ethereum formed a massive daily candle and a remarkable volume spike when it surged from the region below $2,000 and momentarily broke above $2,300. Additionally, the move sent the daily RSI above 80, putting ETH firmly in overbought territory, indicating incredibly strong short-term momentum.
More significantly, ETH overcame a number of technical obstacles nearly simultaneously. The asset broke above the major long-term moving average around $2,125 after reclaiming the moving averages around $1,875 and $1,935.
As leveraged shorts hit their liquidation thresholds, this likely accelerated forced buying. The pension-usdt.eth loss illustrates the risk of extending even a remarkable trading record indefinitely. While a 23-win run can yield significant profits, leveraged short positions carry asymmetric risk during sudden upside repricing.
Ethereum is currently trading at about $2,250 following the surge. Maintaining the technical significance of the breakout would require holding above roughly $2,125. Even though the market's structure has significantly improved, short-term volatility and a possible cooldown remain significant risks, with the RSI above 80 after such an aggressive liquidation-driven move.
U.Today Editorial Team
Dan Burgin
