Hedera (HBAR) has become the biggest loser among the top 100 cryptocurrencies after a 20% price drop in the last 24 hours. This drop in HBAR’s price came just hours after a 180% surge
BeInCrypto’s findings suggest that the recent notable market decline may be linked to growing speculation about the potential successor to the position of US SEC chairman. However, this is not the only factor influencing the drop.
Hedera falls in several areas because of this.
HBAR witnessed a price surge after Canary Capital filed its first exchange-traded fund (ETF) application for the asset. The news marked a major milestone for Hedera, bringing optimism to investors and driving an initial price surge.
However, the three-digit rally in HBAR's price appears to be more closely linked to speculation about the potential appointment of Hedera board member Brian Brooks by US President-elect Donald Trump as the next SEC chairman.
But yesterday (19), the rumors changed, with some media platforms suggesting that crypto lawyer Teresa Goody Guillen could now be the leading candidate. As a result, the price of HBAR fell by 20%.
Following the development, total Open Interest (OI) in HBAR derivatives fell from $120 million to $100.95 million.
Ivy Open Interest Source: Santiment
The drop in OI reflects reduced speculative activity, as fewer traders are initiating new positions. Furthermore, this reduction in speculative activity often leads to decreased liquidity, suggesting that the altcoin may struggle to sustain its recent uptrend.
Furthermore, the positive sentiment around the project, which had previously increased, has now decreased. Typically, an increase in positive sentiment indicates an increase in bullish comments about the cryptocurrency.
However, the recent drop in sentiment suggests a waning of these bullish discussions. If this trend continues, it could further challenge HBAR’s price ability to move higher in the near term.
Hedera Positive Sentiment. Source: Santiment
HBAR Price Prediction: Pessimistic Situation
From a technical perspective, the drop in HBAR price can be attributed to the fact that the altcoin was overbought. This was indicated by the Relative Strength Index (RSI), which measures momentum,
In addition to measuring momentum, the RSI also shows whether a cryptocurrency is overbought or oversold. When the reading is above 70.00, it is overbought. Conversely, if it is below 30.00, it is oversold.
Hedera Daily Analysis. Source: TradingView
With this position, the price of HBAR could likely drop from $0.13 to $0.095. However, if buying pressure increases again for the altcoin, this could change. If that happens, HBAR could rise to $0.016.
The article HBAR drops 20% after SEC chairman rumor appeared first on BeInCrypto Brasil.
