Ethereum’s All-Time High Sparks Short Squeeze Season—What Comes Next?

Ethereum has achieved a new milestone by surpassing its previous all-time high set in 2021, climbing above $4,900 before a slight ￰0￱ the time of writing, ETH trades around $4,655, representing an 8.2% gain over the past ￰1￱ rally comes after three years of consolidation below its former peak, marking a significant moment for the second-largest cryptocurrency by market capitalization. Unsurprisingly, Ethereum’s upward momentum has also shifted market sentiment, placing most ETH holders back in ￰2￱ latest movement has been tied not only to retail activity but also to growing institutional ￰3￱ argue that this demand could be a major factor supporting Ethereum’s renewed market ￰4￱ Reading: Ethereum Whale Demand Surges On Binance As Price Nears $5,000 Institutional Demand and Market Positioning One of CryptoQuant’s contributors, known as Oinonen, highlighted how Ethereum is increasingly attracting institutional interest, signaling a change in the broader ￰5￱ Bitcoin has historically been viewed as the preferred digital asset for large investors, Ethereum’s use in decentralized finance (DeFi) and the recent inflows into spot ETH exchange-traded funds (ETFs) are shifting perceptions.

“Ethereum is now emerging as a challenger to Bitcoin’s institutional dominance,” Oinonen ￰6￱ an example, he pointed to Tom Lee’s Bitmine Immersion Technologies, which acquired $6 billion worth of ETH in just two ￰7￱ alone boosted Ethereum’s market capitalization from $300 billion to $557 ￰8￱ context, MicroStrategy, led by Michael Saylor, accumulated about $3 billion worth of Bitcoin over the same period, highlighting how significant ETH’s recent accumulation has ￰9￱ surge in institutional demand also aligns with Ethereum’s technical ￰10￱ price action suggests not only speculative buying but also structural changes in how the asset is being integrated into professional ￰11￱ ETFs now approved and trading on national platforms in multiple regions, the shift is viewed as an important milestone for Ethereum’s role in global ￰12￱ Short Squeeze and Volatility Outlook Another factor driving ETH’s price action is the unwinding of short positions on ￰13￱ noted that Ethereum has long been a favored asset for traders betting on ￰14￱ unexpected breakout to new highs, however, triggered what he described as a “short squeeze,” forcing bearish traders to buy back ETH to cover their ￰15￱ buying pressure amplified upward momentum and contributed to the rapid move toward $4,900.

“The market is entering what could be called a ‘short squeeze season,’” the analyst explained, adding that Ethereum’s persistent rally may continue to pressure short ￰16￱ this scenario supports near-term gains, it also introduces the possibility of heightened volatility as positions are ￰17￱ ahead, Oinonen expects both Ethereum and Bitcoin to push toward further highs in the coming months, though he cautioned that a market correction could emerge between late 2025 and early ￰18￱ interplay between institutional demand, ETF inflows, and derivatives market dynamics is likely to define Ethereum’s trajectory during this ￰19￱ image created with DALL-E, Chart from TradingView