Hedera's Square Shoulders Pattern Signals Further Downside Risk

As of January 30, 2026, Hedera (HBAR) has come under significant technical pressure, with the token trading at $0.10 and displaying a 7-day decline of -7.29%. Technical analysts at NS3.AI have identified a concerning chart formation that could spell trouble for HBAR bulls in the near term. The square shoulders pattern, a variation of classical head-and-shoulders formations, combined with negative capital flows and bearish market sentiment reaching 50%, paints a precarious picture for this cryptocurrency.

Technical Formation Deepens as HBAR Faces Pressure

The square shoulders configuration that has emerged in HBAR’s price chart represents a textbook reversal pattern. This formation is characterized by relatively flat shoulders on either side of a central peak, creating a distinctive silhouette that historically precedes significant downward moves. With a neckline positioned near $0.102, a breakdown below this critical support would establish the completion of this bearish formation and potentially trigger the pattern’s target objective.

According to technical analysis, a breach of the $0.102 neckline could unleash a measured decline of approximately 20%, taking HBAR down to around $0.08 levels. This forecast is corroborated by additional technical indicators, particularly the deteriorating Chaikin Money Flow reading, which confirms fund outflows from the market. The combination of structural weakness and weakening capital participation underscores the urgency of monitoring this technical setup.

Key Support Levels and Recovery Opportunities

Despite the bearish technical backdrop, opportunities for tactical reversals remain viable. The $0.105 and $0.112 resistance levels represent critical battlegrounds where HBAR could attempt to stabilize and initiate a recovery sequence. If the token manages to reclaim these price zones, it could neutralize some of the immediate downside risks and suggest that smart money accumulation is occurring beneath current levels.

The elevated short positioning in HBAR, combined with potential exchange outflows, creates asymmetric risk conditions. Any sudden positive catalyst or coordinated buying pressure could trigger sharp short-covering rallies, providing nimble traders with tactical opportunities. However, such rebounds should be viewed as potential selling opportunities near overhead resistance unless the square shoulders pattern is definitively invalidated through a sustained close above $0.112.

The current market sentiment, with 50% of participants holding bearish outlooks, leaves room for sentiment oscillation, which could fuel near-term volatility in either direction. Traders should maintain disciplined risk management and adhere to technical levels while awaiting further clarity on HBAR’s directional bias.