ASTER price has fallen almost 40% in the past 30 days and is trading near $1.10 after weeks of steady selling. On the surface, the downtrend looks heavy, but behind the scenes, a combination of retail exits and short-heavy positioning may actually be driving the next rebound.
If ASTER is able to recover $1.39, it would complete a definitive short squeeze play and the structure could quickly reverse.
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Retail is a step forward, but crowded short shops could lay the groundwork
Small investors appear to be retreating. The money flow index, which tracks how much money is moving in and out of the market, has fallen more than 50% since mid-October, dropping from nearly 80 to 38.27. This means retail traders are not buying as aggressively as they used to. This usually indicates weakness, but it can also create a situation where big traders quietly accumulate before moving higher.
Meanwhile, derivatives data shows that most traders are leaning heavily on the short side. This also confirms the bearish bias and decline in MFIs.
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On Binance alone, ASTER short liquidations totaled $34.6 million, while long liquidations totaled $8.46 million. This means that almost 80% of leveraged positions are betting on further decline. This is a highly biased setup and often leads to sudden reversals when price pressure changes.
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The liquidation map suggests that all these short positions will be forced to close if ASTER price rises above $1.39 (26% increase from current levels). Such a squeeze could trigger automated buy orders, cascading into an even sharper rally.
So, while retail money is being drained and sentiment appears to be weakening, the very imbalances could drive a rebound if they break through to the right level.
One ASTER price level can completely reverse the configuration
The 4-hour price structure of the ASTER chart explains the possibility of a pullback in retail prices. The token is still trading within a descending channel, which is a pattern that usually indicates weakness. That visual weakness may be keeping retail traders away.
However, behind the scenes, this system may be quietly changing. The same falling channel also supports the short squeeze possibility mentioned earlier. The short-term liquidation cluster is nestled snugly between $1.15 and $1.39, and if ASTER starts to rise within this zone, it could wipe out many traders who were betting on the downside, meaning the rally will accelerate.
The Relative Strength Index (RSI), which measures the strength and speed of price movements, further strengthens this theory. From October 11th to October 21st, the RSI made higher lows and the ASTER price made lower lows. This bullish divergence typically appears when sellers are losing power even though price remains weak. This change in momentum often precedes a rebound, especially when combined with high short-term exposure.
If ASTER manages to rise above $1.39, it will not only break the upper trend line of the descending channel, effectively canceling the bearish setup, but also triggering a whole round of short liquidations. This could push the price towards $1.88 and $2.22.
On the other hand, if ASTER price falls below $1.05, the pullback setup will weaken. A close below $0.92 will result in a breakout of the lower bound of the channel. And that would expose the token to an even deeper decline, negating any potential recovery.
