Hedera Short Squeeze Setup: $4M Liquidation Trigger Awaits Breakout

Hedera is building a compelling technical setup for a potential short squeeze, with current price action at $0.10 suggesting the groundwork for forced liquidations. The cryptocurrency has established a descending broadening wedge pattern—a formation that often precedes significant reversals when accompanied by weakening selling pressure. While HBAR trades near recent support levels, the technical structure points toward upside potential that could materialize if key resistance breaks decisively.

When Selling Pressure Eases: The Momentum Confirmation

The Money Flow Index is flashing a critical bullish signal through a divergence against HBAR’s recent price action. While the token recently posted lower lows, the MFI printed higher readings—a classic indicator that sellers are losing conviction. This weakening distribution suggests HBAR holders are pulling back from aggressive selling, which typically precedes price stabilization and bounce attempts.

The importance of this divergence lies in what it reveals about market psychology. When momentum indicators improve during price declines, it signals reduced urgency among bearish traders. Investors appear to be slowing their exit pressure, potentially allowing the descending wedge to compact and eventually break upward.

The short squeeze scenario gains teeth when examining liquidation data. On-chain analysis reveals concentrated short positions clustered near the $0.1012 level. A confirmed breakout pushing HBAR above this threshold would apply significant pressure to these bearish positions. According to liquidation maps, a rally into this zone could trigger approximately $4.34 million in forced liquidations. This forced buying pressure from squeezed shorts often accelerates momentum sharply in volatile altcoins, reinforcing breakout structures and potentially creating a self-fulfilling rally.

The Bitcoin Question Remains Critical

Despite improving internal technical signals, Bitcoin continues to exert outsized influence over HBAR’s directional bias. The correlation between these assets has strengthened considerably over recent months, creating a dependency that can override individual technical setups. Hedera has demonstrated a pattern of mirroring Bitcoin weakness regardless of its own bullish structure, suggesting systemic market dynamics supersede isolated chart patterns.

A brief divergence occurred between June and July 2025, when Bitcoin advanced while HBAR moved sideways—a rare separation that highlighted their usual synchronization. Outside that window, price behavior moved in lockstep. With correlation now tightening further, HBAR faces a headwind if Bitcoin fails to generate upward momentum. BTC currently trading near $72.82K, will likely determine whether HBAR’s breakout thesis materializes or stalls at resistance.

Targeting the $0.1071 Level Before Extended Rally

At $0.10, HBAR sits within the descending broadening wedge with immediate resistance at $0.0938 continuing to cap upside attempts. A genuine breakout requires multiple confirmations: flipping the $0.1005 level into support and decisively breaching the $0.1071 threshold. Clearing those levels would substantially strengthen the bullish outlook and potentially open a path toward $0.1300, representing a recovery of recent losses. The $0.1071 mark remains the primary short-term objective before any extended rally becomes sustainable.

However, renewed Bitcoin weakness could invalidate the bullish thesis entirely. Failure to overcome immediate $0.0938 resistance or loss of the $0.0855 support level would increase downside risk substantially. A drop toward $0.0780 would confirm continued range-bound consolidation and delay any short squeeze scenario, pushing the breakout target further into the future.