Ethereum Comes Under Bearish Pressure as $145M ETH Longs Liquidated in a Day

Ethereum faced intense selling pressure this week as leveraged traders were caught off guard by a sharp price drop. This sharp downturn reflects a triple hit to Ethereum’s short-term outlook: mass liquidations fueling a feedback loop of forced selling, capital rotation from ETH to Bitcoin in ETF flows, and a bearish technical breakdown pointing to further downside risks.

Record Liquidations Spark Panic Selling

On August 28, Ethereum traders faced a heavy wave of liquidations, with over $145 million in ETH long positions wiped out in just one day, according to CoinGlass. The sudden drop below the $4,488 price threshold set off a chain reaction of automatic margin calls, forcing leveraged traders to exit at steep losses.

Source: Coinglass

The next key risk area sits at $4,200, where nearly $928 million in short positions would face liquidation if prices rebound. This makes $4,200 a crucial pivot zone for both bulls and bears in the days ahead.

ETF Flows: Signs of Rotation from ETH to BTC

Beyond liquidations, ETF flows suggest a shifting tide between major digital assets. Ethereum ETFs recorded $196.6 million in outflows on August 18, while Bitcoin ETFs drew $219 million in fresh inflows on August 28.

This divergence may point to investors rotating from ETH to BTC amid macroeconomic uncertainty, including the dismissal of a U.S. Federal Reserve Governor and a volatile GDP data release. While near-term flows appear bearish for Ethereum, it’s worth noting that ETH ETFs still hold $24.15 billion in AUM. This level of institutional commitment indicates confidence in Ethereum’s long-term role within the digital asset ecosystem, even as tactical positioning favors Bitcoin.

Technical Breakdown Reinforces Bearish Bias

Ethereum’s chart structure adds weight to the bearish outlook. The asset broke below the 23.6% Fibonacci retracement level ($4,577) and slipped under its 100-hour simple moving average (SMA)—both common indicators that traders view as critical support zones.

The MACD histogram flipped negative (-30.8), confirming momentum has tilted toward sellers. Unless buyers reassert control, the next meaningful support sits at $4,020 (38.2% Fib retracement), which could provide a stabilizing floor if tested.