- •ETH funding rates moved from negative to neutral with traders waiting for confirmation.
- •Liquidity walls between $4,400 and $4,600 signal heavy selling pressure on Ethereum.
- •Analysts warn $13.22B in shorts could be liquidated if Ethereum climbs to $4700.
Ethereum is approaching critical levels, with analysts warning of very high liquidation risks. Data from @Morecryptoonl and Coinglass indicate that ETH is moving in a clear Elliott Wave cycle, while CoinMarketCap confirms sharp market activity. An accompanying note from X analysts humorously forecast that $13.22B in short positions could be wiped out if ETH strikes $4,700. This sets up a defining test as heavy liquidity clusters await the token between $4,400 and $4,600.
Elliott Wave Analysis Signals a Key Turning Point
Recent movement on Ethereum has generated a wave 4 around $4,061, aligning with the 23.60% Fib level. The token then randomly hovered in the retracement zones between $3,665 and $3,374 before bouncing back to $4,307.
The reverse bounced above the green ascending trendline, keeping the structure intact. Wave iii had found its peak at $4,612, coinciding with the 78.60% Fib mark. Analysts confirmed that there should be a straightforward 1-2 setup pointing upward to prove it.
If validated, the next upside target stands at $5,233, with the 123.60% Fibonacci extension. Further resistance is mapped at $5,815 and $6,406—a maximum Fibonacci extension of 161.80% places potential price expansion near $6,922.
At present, momentum remains delicate within the $3,374–$4,612 range. The yellow channel marks resistance while the white 200-day moving average provides long-term support beneath current price action. This balance raises one pivotal question: will ETH confirm its next wave toward $6,000 or break lower support?
Funding Rates Reveal Shifting Market Sentiment
According to CoinGlass, the OI-weighted Ethereum funding rate has fluctuated sharply since June, ranging between -0.0100% and +0.0200%. Such fluctuations are entirely consistent with the price volatility of ETH. Funding rates remained consistently above +0.0100% from July 12 to August 14, setting the stage for the rally in ETH from $3,000 to over $5,300. Long positions gradually became more silver-lined for the holders at the cost in the process.
Source: Coinglass
The mode reversed in September when funding rates began to turn negative, thus pricing the ETH retreating toward $3,000. Since then, however, conditions have stabilized, with readings approaching neutrality; this specifier denotes a considerable period of indecisiveness or a balanced opinion among traders. The market now properly balances the optimism for a breakout above $5,000 against the debilitating doubt of another plunge to $3,000.
Related: Bitwise CIO: Bitcoin, Ethereum, Solana Target Trillions in Finance
Liquidity Maps and Market Data Define the Road Ahead
Ethereum’s order book heatmap from X identifies heavy liquidity walls between $4,400 and $4,600. This area forms a resistance block where sellers dominate, presenting a difficult hurdle for bullish momentum. On the lower side, support is scattered between $3,800 and $4,000. Analysts warned of thinner liquidity in that region, leaving prices vulnerable to swift declines if bearish pressure increases.
Source: X
The chart’s analyst added that if ETH rises to $4,700, $13.22B worth of short positions could be liquidated. Describing the scenario as “biblical,” the commentary highlighted the scale of potential liquidation.
CoinMarketCap data reinforces the growing momentum. ETH is priced at $4,299.81, up 3.16% from the past day at the time of press. Market capitalization stands at $519 billion, equal to its fully diluted valuation. Trading volume reached $44.38B in 24 hours, an increase of 0.81%. Circulating and total supply both stand at 120.7M ETH, confirming stability in issuance. With buyers driving recovery from $4,168 to $4,280, ETH maintains a 100% profile score. The token now edges closer to retesting $4,300 and beyond.