The price of HBAR, the native token of the enterprise-focused Hedera network, is at a critical technical juncture. A confirmed breakdown from a bear flag pattern on the 4-hour chart signals a high risk of continued decline, with a measured move target projecting a potential 28% drop toward the $0.068 zone. This bearish technical structure is compounded by a near-total evaporation of dip-buying pressure, as evidenced by on-chain data. However, a significant divergence is emerging: while price action weakens, fundamental network activity and adoption metrics tell a contrasting story of growth.
Figure 1: Bear Flag Breakdown. A conceptual illustration of the bear flag pattern identified on HBAR's 4-hour chart. The pattern consists of a sharp decline (flagpole), a period of consolidation, and a decisive breakdown, signaling the likely continuation of the downtrend.
⚖️ The Conflicting Signals at a Glance
HBAR's current state is defined by a clash between bearish price structure and robust network fundamentals.
Market Context: Persistent Weakness in a Broader Altcoin Downturn
HBAR's struggles are not occurring in a vacuum. The token has declined roughly 26% over the past month and nearly 67% year-on-year, reflecting a period of persistent weakness that aligns with broader pressures in the altcoin market. This sustained downtrend has eroded investor confidence, setting the stage for the current technical breakdown. The price is now threatening to revisit levels not seen since October 2024, which would mark a new multi-month low and potentially trigger a new wave of capitulation.
Technical Analysis: Anatomy of the Bear Flag Breakdown
The primary technical concern is the completion of a bear flag pattern on the 4-hour timeframe.
Understanding the Bear Flag Pattern
This is a classic continuation pattern observed in downtrends:
1. The Flagpole: A sharp, high-momentum decline.
2. The Flag: A period of sideways or slightly upward consolidation, representing a pause in selling pressure.
3. The Breakdown: A decisive break below the flag's lower trendline, resuming the prior downtrend.
HBAR has confirmed step three, breaking below the flag structure near the $0.109 level. The pattern's measured move technique, which projects a decline equal to the length of the initial flagpole, points to a target zone between $0.079 and $0.068. For the breakdown risk to be invalidated, HBAR would need to reclaim and hold above the $0.109 level, turning it back into support.
Price Targets and Key Levels
| Technical Element | Observation | Implication |
|---|---|---|
| Pattern Identified | Bear Flag on 4H Chart | High-probability signal for trend continuation to the downside. |
| Breakdown Level | $0.109 | This level now acts as immediate resistance. A close above it weakens the bearish case. |
| Primary Target Zone | $0.079 - $0.068 | Projected downside based on the flagpole's measured move (approx. -28%). |
| Key Higher Timeframe Support | $0.068 (Oct-Nov 2024 Lows) | A critical historical level. A break below could open the door to deeper, uncharted declines. |
On-Chain & Sentiment Indicators: Demand Evaporates
The technical breakdown is reinforced by alarming on-chain and sentiment data, highlighting a severe lack of buyer conviction.
Collapsed Buying Pressure
Net exchange outflows—a metric that can indicate accumulation—have plummeted by over 92% in less than three weeks. From roughly 4.09 million HBAR leaving exchanges on December 5, net outflows dwindled to just 314,830 HBAR by December 24 (Source: BeInCrypto). This suggests that even at these lower prices, investors are not moving tokens off exchanges to hold en masse, leaving the market vulnerable to further exchange-based selling.
Extreme Sentiment Washout
Social sentiment toward HBAR has fallen dramatically, with one metric indicating a drop from a peak near 77 in late October to approximately 1.6 by late December—a decline of about 98% (Source: BeInCrypto). While such extreme negativity can sometimes precede a contrarian bounce, it occurs here within a strong structural downtrend, limiting its reliability as a standalone buy signal.
📈 The Fundamental Divergence: Network Growth vs. Price
Contradicting the bleak price action, activity on the Hedera network shows notable strength. The Total Value Locked (TVL) in Hedera's DeFi ecosystem has surged over 40% in the past 30 days, significantly outpacing broader market trends (Source: DeFiLlama). Furthermore, the network continues to process a high volume of transactions from enterprise use cases, such as coupon issuance and supply chain tracking, demonstrating real-world utility. This creates a fundamental divergence where network adoption grows while the token's market price falls—a dynamic that may eventually correct if the utility translates into sustained token demand.
Forward-Looking Scenarios
The path forward for HBAR depends on whether the bearish technical structure and weak demand overpower the potential for a sentiment-driven bounce or a fundamental re-rating.
🔴 Bearish Scenario: Pattern Plays Out to Target
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Trigger: Price remains below $0.109 and breaks below immediate support near $0.095.
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Price Action: The bear flag's measured move unfolds, driving price toward the primary target zone of $0.079 - $0.068. The October 2024 low of $0.068 becomes a critical test.
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Driver: Continued absence of significant buying pressure, coupled with potential panic selling if $0.068 support fails.
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Invalidation: A sustained 4-hour close above the $0.109 breakdown level would significantly weaken this scenario.
🟢 Bullish/Relief Scenario: Exhaustion Bounce & Fundamental Reassessment
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Trigger: Extreme negative sentiment sparks opportunistic dip-buying, leading to a sharp short-covering rally.
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Price Action: A relief bounce back toward the $0.125 - $0.14 area (previous congestion zone). However, without a reclaim of $0.155, the larger downtrend remains intact.
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Driver: A market-wide altcoin rebound or a specific Hedera ecosystem announcement that shifts sentiment. The growing network TVL and transaction volume could eventually attract value-oriented investors.
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Invalidation: A failure to hold any bounce and a swift drop below $0.09 would indicate this relief rally has failed.
Strategic Implications for Traders and Investors
For active traders, the dominant trend is bearish until proven otherwise. Risk management is paramount. Any long positions attempted on a sentiment bounce should be treated as counter-trend trades with tight stop-losses below recent lows. The $0.109 level serves as a clear line in the sand for any shift in short-term structure.
For long-term investors, the environment presents a complex dichotomy. The severe price decline and washed-out sentiment could be creating a potential long-term value area, especially when considered alongside Hedera's demonstrable network growth. However, attempting to "catch the falling knife" carries significant risk. A more prudent strategy may involve waiting for the price to show clear signs of stabilization, such as a higher low formation or a sustained break above a key resistance level like $0.155, before considering accumulation.
About the Author: Alexandra Vance
Alexandra Vance is a senior crypto analyst specializing in the convergence of technical analysis, on-chain data, and fundamental network metrics. Her research focuses on identifying high-probability market structures and the underlying fundamental drivers that may confirm or contradict them.
Disclaimer: This article is for informational and educational purposes only. The analysis is based on technical patterns, on-chain data, and publicly available network metrics. It does not constitute financial advice, a recommendation to buy or sell any asset, or an endorsement of any investment strategy. Cryptocurrency markets are highly volatile and involve substantial risk. You should conduct your own independent research (DYOR) and consider consulting with a qualified financial advisor before making any investment decisions. The author and publisher are not responsible for any financial losses incurred based on information in this analysis.