The final week of February has brought another wave of declines, reinforcing expectations among short-term traders that altcoin prices could fall further. However, this outlook carries growing risks. If prices approach strong demand zones, they could stage an unexpected rebound.
Several altcoins are showing a severe imbalance between potential long and short liquidations this week. Such conditions often create an environment for large-scale liquidations.
1. Ethereum (ETH)
The seven-day liquidation map for Ethereum (ETH) shows that many traders are allocating capital and leverage to short positions, betting on continued downside through the end of the month.
As a result, cumulative potential liquidations on the short side now dominate. If ETH unexpectedly rebounds to $2,000 this week, short positions could face up to $2 billion in liquidations.
If ETH climbs further to $2,160, short liquidations could reach $3.6 billion.
Short-term traders have reasons to justify their bearish positioning. A recent report by BeInCrypto revealed that Vitalik Buterin reduced his holdings by more than 8,800 ETH throughout February 2026. Meanwhile, Ethereum inflows to Binance have reached their highest level since November 2025.
However, several bullish indicators are also emerging, increasing the likelihood of a surprise recovery.
ETH ETF flows have turned positive after four consecutive weeks of outflows. In addition, data from CryptoQuant shows that inflows into ETH accumulation addresses over the past six months have reached the most active period in history.
Given these dynamics, short sellers may need to reassess their leverage levels to mitigate the risk of sudden price reversals.
2. Binance Coin (BNB)
Like ETH, Binance Coin (BNB) has faced persistent selling pressure. Six consecutive red weekly candles with no clear signs of recovery have encouraged traders to maintain dominant short positions.
However, this positioning increases the risk of liquidation if BNB rebounds.
If BNB climbs to $640 this week, potential short liquidations could reach $35 million. A further rally to $680 could push short liquidations above $60 million.
Why should short traders remain cautious?
First, BNB is approaching its long-term support trendline established in 2024. Shorting near strong support levels often carries elevated risk.
Second, data from On-Chain Mind, a crypto analytics account, indicates that BNB is currently trading about 37% below its short-term holder realized price equivalent. Historically, this level has signaled meaningful undervaluation and has often preceded strong repricing moves.
“Right now it is trading about 37% below its short-term holder realised price equivalent, a level that historically signals meaningful undervaluation. BNB has a history of sharp repricings from zones like this,” On-Chain Mind reported.
Short sellers who grow overly confident in BNB’s downtrend could face significant losses if momentum shifts.
3. Bitcoin Cash (BCH)
Bitcoin Cash stands out as one of the few altcoins that has not behaved as if it were in a broader crypto bear market.
Nevertheless, short-term traders have turned increasingly bearish on BCH in the final week of February. Their positioning has pushed potential short liquidations well above those on the long side.
Data from Bitinfocharts shows that whales have actively accumulated BCH in recent months. One whale address accumulated 400,000 BCH within two months, becoming the network’s third-largest holder.
In addition, a recent report by BeInCrypto stated that the average transaction value on the BCH network surged to over $2 million, nearly 100 times higher than last year.
Under these conditions, heavily leveraged short positions could face liquidation risks if BCH rebounds. A move toward $630 this week could trigger up to $45 million in short liquidations.
In general, extremely negative market sentiment often creates ideal conditions for short squeezes.
“The sentiment in crypto right now is so bad that I’m actually pretty optimistic,” said Tyler Winklevoss, co-founder of Gemini.
In such an environment, short sellers may still capture profits. However, without disciplined profit-taking strategies and strict risk management, gains can quickly evaporate and turn into losses.
