Hedera (HBAR) is currently navigating within a descending wedge that has persisted for over 10 weeks. The altcoin is making an attempt to break free from this pattern, which might shift momentum towards the bulls.
However, such a breakthrough could come at a significant cost for short traders reluctant to adjust their positions.
Hedera Traders Could Face Losses
According to liquidation data, over $32 million in short contracts could be liquidated if HBAR climbs towards its next significant resistance. The crucial level to monitor is $0.248, which lies just above the immediate resistance zone. A move beyond this threshold would compel bears to exit, thereby generating additional buying pressure.
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This scenario could be bullish for Hedera. Forcing shorts out of the market typically discourages new bearish positions, creating room for the asset to stabilize. With fewer traders inclined to short HBAR, the token could sustain upward momentum and establish stronger support at elevated price levels.
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The Chaikin Money Flow (CMF) is indicating increasing confidence in HBAR. The indicator has been consistently rising, reflecting ongoing inflows into the asset. Strong inflows signify heightened demand, which is vital for supporting recovery efforts and backing attempts to break free of the descending wedge.
Sustained strength in the CMF further reinforces the bullish continuation case. As capital continues to flow into HBAR, the market structure strengthens, countering any selling pressure from traders betting against the token.
HBAR Price Awaits Breakout
As of the latest updates, HBAR is priced at $0.226. The token has been consolidating within its wedge for nearly three months. A confirmed breakout would necessitate a decisive movement above $0.230, with the next resistance positioned at $0.242. Overcoming these barriers is crucial for validating the bullish outlook.
If HBAR successfully breaches $0.242, the liquidation map indicates that $32 million worth of shorts would be liquidated at $0.248. This liquidation wave could propel a stronger rally, assisting HBAR in extending gains and stabilizing at higher price points.
However, failure to break out would keep HBAR confined within its current wedge. In that scenario, the altcoin could retreat back to $0.219 support or lower, negating the bullish thesis and exposing traders to further downside risks.
