HBAR (Hedera Hashgraph) Price Analysis: Key Levels to Watch After Reacting to Supply Zone

In our last analysis of HBAR, we highlighted how the price was reacting to a supply zone. But what exactly is a supply zone?

In our last analysis of HBAR, we highlighted an interesting setup forming at a supply zone. But before we dive into what happened next, let's quickly recap what a supply zone is.

In simple terms, a supply zone is an area where there are more sellers than buyers, typically leading to price reversals or pullbacks. However, in this case, the market presented both upper and lower liquidity, creating an intriguing scenario.

What Happened Next?

Well, instead of taking the path of least resistance and heading toward the upper liquidity, HBAR reacted to the supply zone and grabbed the liquidity resting below. This is a common occurrence in markets—liquidity serves as a magnet for price.

Traders who were waiting to see if the upper liquidity would be tapped before shorting had to exercise patience as the market played out.

What Could Happen Now?

Based on the price action and technicals, here are two potential scenarios for HBAR:

Bullish Reaction from Demand Zone

After dropping from the supply zone, HBAR could respond to a nearby demand zone. This may allow the price to recover some of the liquidity left behind during the drop.

A short-term bounce is possible, but traders should watch how the market structure develops.

Continued Bearish Momentum

Alternatively, HBAR may continue its downward trajectory, potentially revisiting smaller supply zones before another leg down.

Traders looking to short should monitor these areas closely.

The Importance of Flexibility in Trading

It's crucial to remember that price movements are inherently unpredictable. While these scenarios are derived from technical analysis, nothing is guaranteed. The market could surprise us and go entirely off-script.

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