The HBAR Short Squeeze: A $35M Liquidation Opportunity in the Altcoin Market

The cryptocurrency market is no stranger to volatility, but when a token like Hedera Hashgraph (HBAR) aligns with Bitcoin’s (BTC) trajectory while offering a high-conviction short-squeeze setup, the risk-reward calculus becomes compelling. As Bitcoin stabilizes above $110,000—a critical psychological threshold—HBAR’s 0.92 correlation with BTC positions it to benefit from the broader market’s bullish momentum [1]. However, the token’s recent divergence from Bitcoin’s orbit introduces a unique opportunity: a potential $35 million short liquidation event if HBAR breaks above $0.218.

Bitcoin’s Role in HBAR’s Momentum

HBAR’s price has historically moved in lockstep with Bitcoin, but this correlation has weakened to a 2-month low, creating a window for independent price action [3]. This divergence is both a risk and an opportunity. On one hand, reduced correlation exposes HBAR to idiosyncratic selling pressure, as evidenced by weak Chaikin Money Flow (CMF) readings [3]. On the other, it means the token is undervalued relative to its BTC-linked peers, offering a contrarian entry point.

If Bitcoin continues its upward trajectory, HBAR’s beta to BTC could amplify gains. Analysts project a 100-150% upside for HBAR by year-end, with a price target of $0.70, driven by its strong correlation and seasonal bullishness in October and December [4]. This makes HBAR a dual-play asset: it benefits from Bitcoin’s macro narrative while offering leveraged exposure to altcoin-specific catalysts.

Short Liquidation Mechanics: A $35M Catalyst

HBAR’s current price of $0.216 sits just below a critical resistance level at $0.218. A breakout above this level could trigger a short squeeze, as over $35 million in short positions are at risk of liquidation if the price reaches $0.230 [1]. This creates a self-fulfilling prophecy: as short sellers scramble to cover positions, buying pressure intensifies, potentially propelling HBAR toward $0.244.

The mechanics here are textbook. Short sellers borrow HBAR to sell it, betting on a price decline. If the price rises instead, they must repurchase the token at a higher price to return it, incurring losses. When enough shorts face margin calls, the price can surge rapidly. For traders, this means a high-conviction entry point exists just below $0.218, with a clear risk-reward profile: a failure to break above $0.218 could lead to consolidation between $0.218 and $0.205, while a successful breakout could unlock significant upside [1].

Risk-Reward Analysis: Balancing Optimism and Caution

While the short-squeeze scenario is enticing, it’s not without risks. HBAR’s weak CMF and outflows over the past two months suggest lingering selling pressure [3]. A breakdown below $0.205 could negate the bullish case, making tight stop-loss placement essential. Traders should also monitor Bitcoin’s performance, as a pullback in BTC could dampen HBAR’s momentum.

However, the potential rewards outweigh the risks. If HBAR breaks $0.218 and triggers the $35M liquidation event, the token could surge toward $0.244 in the short term and $0.527 by year-end [2]. This aligns with broader price projections that position HBAR as a top-performing altcoin in 2025 [4].

Strategic Entry and Exit Points

For investors seeking to capitalize on this setup, the optimal entry point is just below $0.218, with a stop-loss placed below $0.205. A successful breakout would target $0.230 (liquidation threshold) and then $0.244. Given the token’s seasonal strength in October and December, holding through short-term volatility could yield substantial returns [2].

Conclusion

HBAR’s unique position at the intersection of Bitcoin-driven momentum and short-squeeze potential makes it a standout trade in the altcoin market. By leveraging BTC’s bullish trajectory and the mechanics of short liquidation, traders can access a high-conviction opportunity with clear technical and macroeconomic justifications. However, as with all leveraged plays, discipline in risk management is paramount. For those willing to navigate the volatility, the $35M liquidation event could be the catalyst that propels HBAR into a new price era.

**Source:[1] HBAR Traders May Face $35 Million Liquidations Thanks [https://www.mitrade.com/insights/news/live-news/article-3-1101827-20250907][2] Hedera Hashgraph (HBAR) Price Prediction 2025, 2026- [https://coincodex.com/crypto/hedera-hashgraph/price-prediction/][3] HBAR Leaves Bitcoin's Orbit, Immediate Reaction Brings [https://www.bitget.com/news/detail/12560604886725][4] Will Hedera (HBAR) Price See Further Upside After 55% [https://www.coinspeaker.com/will-hedera-hbar-price-see-further-upside-after-55-rally/]