Helium (HNT) is currently undergoing a considerable decline, raising fears that its price may fall below the crucial level of $6. Recent market trends indicate that sellers are gaining momentum, which could lead to additional losses for HNT holders.
Latest Market Developments
As of September 19, 2024, HNT has continued to lose value amid escalating selling pressure. After failing to hold above the $6.70 support level, the token is vulnerable to a more significant downturn. At the time of this report, HNT was trading around $6.52, its lowest price of the month. This decline follows a fleeting rally that pushed the cryptocurrency above $8 earlier in September.
The increase seen earlier this month was driven by growth in the decentralized physical infrastructure network (DePIN) sector, which has reportedly eclipsed a market capitalization of $17 billion, as per Coingecko. However, traders who entered the market during this recent surge are now cashing out their profits, adding to the downward pressure on HNT.
Technical Indicators Point to Further Declines
Examining the one-day chart for HNT reveals a concerning trend. The Awesome Oscillator (AO) shifted negative for the first time since mid-July, indicating that sellers are gaining traction. This change in momentum is crucial for traders to observe, as it often precedes additional price decreases.
Important Levels to Monitor
The urgent concern for HNT investors is its breach of the 0.618 Fibonacci level at $6.70, a historically significant support zone. Should HNT fail to sustain its current price, a decline towards $5.47 is a distinct possibility. This potential drop is corroborated by the Relative Strength Index (RSI), which is currently at 41. While it is not yet in the oversold region, the RSI is making lower lows, suggesting continued bearish momentum.
Market Sentiment Shifts to Bearish
On-chain metrics also reflect a pessimistic outlook for HNT. Recent findings from Artemis indicate that daily active addresses on the Helium network have fallen to 15,700, marking the lowest level for the month. This drop in user activity could signal a red flag for potential investors, hinting at decreasing interest in the cryptocurrency.
Interestingly, despite the fall in active addresses, daily trading volumes have increased. On September 17, trading volume rose by $5 million, reaching a total of $17 million. While heightened trading volumes often imply increased interest, the lack of accompanying price appreciation points to a market driven more by sellers than buyers.
Short Selling Gains Momentum
Data from Coinglass supports the negative outlook. The long/short ratio has fallen to a historic low of 0.74, signifying that many traders expect further declines in HNT’s price. This sentiment could trigger a self-fulfilling prophecy, as more traders take short positions, amplifying the downward pressure on the token.
What’s Next for HNT Investors?
The combined analysis of recent technical indicators, on-chain data, and prevailing market sentiment suggests a difficult landscape for Helium investors. With persistent selling pressure and bearish formations reflected in the charts, the question lingers: will HNT fall below $6?
For those holding HNT, it might be wise to monitor forthcoming market trends closely. If buyers do not step in to stabilize the price, HNT may indeed breach the critical $6 threshold, resulting in further declines.
Conclusion
As the cryptocurrency market continues to shift, staying informed about the latest trends and indicators is vital for investors. The current scenario for Helium (HNT) underscores the need to keep an eye on both technical indicators and market sentiment. With bearish signals appearing from various angles, investors should brace for possible volatility in the near future.
While the growth of the DePIN sector provides a sliver of hope, the immediate obstacles HNT faces should not be disregarded. As always, exercising caution and conducting thorough research should inform investment decisions in this volatile market.
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