Helium (HNT) has seen a significant 28% bounce in the past week, recovering from a sharp drop earlier this year. However, despite this impressive rally, the cryptocurrency faces several hurdles that could impact its future price movements. While the price bounce has captured attention, the real question is whether Helium can maintain this momentum and break past critical resistance levels.

Recent Price Movement and Bullish Divergence

Helium’s price action during the first week of February signaled potential bullish signs. The cryptocurrency saw a bullish divergence, where the price reached lower lows, but the Relative Strength Index (RSI) made higher lows. This is a classic sign that momentum may be shifting, providing the groundwork for the bounce that followed.

Helium’s price found support at the psychological $3 level, and since then, it has surged approximately 28.5%, reaching as high as $4.18. This recovery was an optimistic development for HNT holders, but a closer look at the market structure reveals that the upward momentum is still fragile, with significant resistance levels looming ahead.

Lack of Strong Buying Volume

One of the major concerns following this bounce is the lack of significant buying volume. Although Helium experienced a notable price surge, the On-Balance Volume (A/D) indicator has remained in a downtrend since mid-December. This suggests that the rally was not driven by strong buying interest, which raises concerns about its sustainability.

While the bounce from the $3.0 level was an encouraging sign for HNT, the market remains cautious. For further gains, there needs to be an influx of buying volume to push past critical resistance points. Without this, Helium’s price may struggle to break above the $4.2-$4.5 range, limiting its potential for continued growth.

The Role of Key Resistance Levels

A significant price target for HNT in the near future remains the $4.24 level. This price point marks a key resistance level, and its ability to break above this price will determine if the market structure will shift to a more bullish stance. If Helium manages to close above this price on a daily basis, it could signal a more sustained bullish move, but until that happens, the market structure remains predominantly bearish.

However, the $4.24 resistance isn’t the only factor weighing on Helium’s price action. The lack of strong buying volume means that even if the $4.24 level is breached, HNT may struggle to hold those levels without solid buyer support.

Potential Range-Bound Movement

Given the current price action, a range formation between the $3.3 and $4.2-$4.5 levels appears likely for the near future. The $3.6 zone has been identified as a key area of liquidity, and its importance was evident during the recent bounce on February 10. If Helium’s price begins to consolidate around the $4 level, it may result in range-bound trading, with the $3.6 zone acting as an anchor for support and the $4.2-$4.5 zone providing resistance.

This range-bound scenario means that Helium’s price could continue to fluctuate within these levels until it either breaks through the resistance or finds further support at the lower levels.

Conclusion

Helium’s recent 28% bounce has fueled some optimism in the market, but there are still several obstacles that could limit its growth. The lack of substantial buying volume, combined with the strong resistance levels near $4.24, suggests that HNT may struggle to maintain upward momentum in the short term. For the price to continue climbing, Helium will need to see stronger support from investors and overcome the significant resistance zones around $4.2-$4.5. Traders will be closely monitoring these levels as they watch for further signs of direction in the coming days.