Helium Faces Price Challenges Amid Market Fluctuations

Helium (HNT) has been experiencing significant price fluctuations, recently needing to close above $4.24 to establish a bullish market structure. After a steep decline of 68.5% from its December resistance level of $9.54, Helium retested the psychological support level of $3 last week. This drastic drop in price over just two months indicates a challenging market environment, with the $3.3 zone now emerging as the next bearish target due to a lack of strong buying momentum and a persistent downtrend since December.
Despite a recent bounce to $4.18, Helium has yet to break its downtrend, although there are signs of weakening bearish momentum. A notable bullish divergence occurred in early February, where the price made lower lows while the Relative Strength Index (RSI) recorded higher lows. This divergence led to a bounce from the $3 support level, resulting in a 28.5% price increase within a week. However, this rally was not supported by strong buying volume, as indicated by the Accumulation/Distribution (A/D) indicator, which has been on a downtrend since mid-December.
The market has shown a large liquidity cluster around the $3.6 mark, which was tested recently, resulting in a quick price jump to $4.19. Following this spike, volatility has decreased, and HNT has consolidated below the $4 level. Traders should prepare for a potential range formation between $3.3 and $4.2-$4.5 in the coming days, with the $3.6 zone likely acting as a barrier to further bearish movements. Overall, the market remains cautious as it navigates these price levels.
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