Hedera’s native token, HBAR, has recently seen its price drop to a two-month low, continuing a persistent downtrend that has lasted several weeks. Despite this decline, market sentiment among HBAR traders remains surprisingly optimistic. While broader crypto market weakness and global uncertainty have impacted most digital assets, HBAR’s community continues to show signs of confidence, evidenced by key on-chain metrics and technical indicators.

One of the clearest signs of bullish sentiment is the consistently positive funding rate for HBAR. Funding rates are payments made between long and short positions in futures contracts, helping to keep prices aligned between spot and futures markets. A positive funding rate means traders are paying a premium to hold long positions, signaling their expectation that prices will eventually rebound. HBAR has maintained a mostly positive funding rate, with only a brief dip into negative territory, underscoring traders’ belief in a near-term price recovery.

Supporting this outlook is the Relative Strength Index (RSI), a widely used technical indicator that tracks momentum. Recently, HBAR’s RSI dipped into the negative zone, suggesting overselling pressure. However, the RSI has since begun climbing again, hinting at the potential for a rebound. If the RSI continues its upward trajectory and breaks above the neutral 50 level, it could confirm growing bullish momentum. A similar pattern occurred in April when HBAR bounced back after RSI levels signaled oversold conditions.

Currently, HBAR is trading at approximately $0.151, marking a 15.8% decline over the past week. This drop places the token just below a key resistance level at $0.154. The next immediate resistance sits at $0.163, and reclaiming both these levels as support would be critical for establishing a broader trend reversal. If HBAR manages to hold above these levels, it could indicate the end of the downtrend and set the stage for further upside in the short term.

Despite these promising signals, caution remains warranted. The crypto market is still heavily influenced by external factors, including geopolitical tensions, particularly the ongoing conflict in the Middle East. These uncertainties could impact overall risk appetite and suppress recovery efforts across digital assets, including HBAR.

In a bearish scenario, if HBAR fails to reclaim $0.154 and $0.163, the token could continue its decline. A breakdown below the $0.145 support level would be particularly concerning and could open the door to a retest of $0.139. Falling to this level would invalidate the current bullish thesis and suggest a shift in market sentiment toward more aggressive selling pressure.

Nevertheless, the resilience shown by HBAR holders, as reflected in derivatives market activity and price action, demonstrates a strong belief in the project’s long-term fundamentals. The Sei ecosystem, Hedera’s enterprise-grade blockchain, continues to attract institutional interest, and future development milestones could help renew momentum for the token.

In summary, while HBAR faces headwinds due to recent price action and macroeconomic uncertainty, the underlying sentiment among traders remains optimistic. Technical indicators such as a rising RSI and consistently positive funding rates support the possibility of a near-term recovery. To confirm this reversal, however, HBAR must reclaim and hold the $0.154 and $0.163 levels. If successful, the token could break free from its downtrend. If not, it may be poised for further declines. As always, traders should closely monitor support levels and broader market conditions before making major moves.