HBAR Plummets 20%—But This $0.29 Liquidation Zone Could Spark a Rebound

HBAR's brutal 20% nosedive has traders sweating—but the blockchain token might be gearing up for a comeback.

All eyes on that $0.29 liquidation cluster: a make-or-break level where leveraged positions could fuel either a vicious death spiral or a vicious short squeeze. No pressure.

Crypto’s usual suspects—overleveraged degens, algorithmic traders, and that one hedge fund intern who still thinks 'Hedera' is a Scandinavian furniture brand—are all lurking here.

Will it bounce? Or just become another 'hold my margarita' moment in the crypto circus? Either way, grab popcorn—and maybe a risk management strategy (lol).

What to Know:

• HBAR has dropped 20% in seven days and now trades near its 20-day exponential moving average at $0.22
• On-chain data shows a liquidity cluster around $0.29 that could attract upward price movement
• The token's funding rate remains positive at 0.0092%, indicating continued bullish sentiment among futures traders

Technical Indicators Point To Potential Breakdown

Daily chart analysis reveals HBAR trading precariously NEAR its 20-day exponential moving average, a widely watched technical indicator that measures an asset's average price over the past 20 trading sessions. The moving average currently sits at $0.22 and has served as dynamic support during the recent decline.

Technical analysts use the 20-day EMA to identify short-term trends and momentum shifts. When an asset's price breaks below this level after an extended uptrend, it often signals a shift from bullish to bearish sentiment among traders.

Sell-side pressure has been building around this critical level. A decisive break below $0.22 could expose HBAR to additional downside, with some analysts targeting the $0.18 level as the next major support zone.

The breakdown scenario reflects broader weakness across cryptocurrency markets. Bitcoin's recent pullback has weighed heavily on alternative cryptocurrencies, with many tokens posting double-digit percentage declines over the past week.

On-Chain Data Suggests Reversal Potential

Despite the bearish technical setup, on-chain metrics paint a more complex picture for HBAR's near-term prospects. Liquidation heatmap data from Coinglass shows a notable cluster of Leveraged positions around the $0.29 price level.

These liquidation clusters represent areas where high concentrations of leveraged traders have positioned stop-losses or face margin calls. When such clusters FORM above an asset's current trading price, they often create upward pressure as the market moves to trigger these positions.

The $0.29 cluster could act as a "price magnet" for HBAR, potentially drawing the token higher if broader market conditions stabilize. This dynamic has played out repeatedly across cryptocurrency markets, where large liquidation zones influence short-term price movements.

Additionally, HBAR's funding rate in perpetual futures markets has remained consistently positive despite the recent price decline. The current rate of 0.0092% indicates that long position holders are paying short sellers to maintain their positions.

Market Sentiment Remains Cautiously Optimistic

Positive funding rates typically reflect bullish sentiment among derivatives traders. The fact that HBAR's funding rate has held in positive territory even during the recent selloff suggests underlying demand for long positions persists.

This metric contrasts with the bearish price action and technical indicators.

Funding rates can provide early signals of sentiment shifts before they manifest in spot prices.

The disconnect between price performance and funding rates creates an interesting dynamic. It suggests that while HBAR faces immediate technical challenges, market participants haven't entirely abandoned bullish positioning.

Traders are essentially paying a premium to maintain long exposure, indicating confidence that current weakness represents a temporary setback rather than a fundamental shift in the token's prospects.

Critical Support Test Ahead

HBAR's immediate fate hinges on the $0.22 support level formed by its 20-day exponential moving average. If this level holds amid the current selling pressure, it could serve as a foundation for a potential rebound toward the $0.26 area.

However, a clean break below this support WOULD likely accelerate selling pressure. Technical analysts warn that such a breakdown could quickly push HBAR toward the $0.18 level, representing additional downside of roughly 18% from current levels.

The broader cryptocurrency market environment will likely influence HBAR's ability to hold key support levels. Any stabilization in Bitcoin and major altcoins could provide the backdrop needed for HBAR to mount a recovery.

Closing Thoughts

HBAR faces a critical juncture as it tests key technical support at $0.22 following a 20% weekly decline. While on-chain indicators suggest potential for reversal, the token's near-term direction largely depends on its ability to hold current support levels amid broader market weakness.