Helium (HNT), an altcoin known for its innovative approach in the decentralized wireless network industry, recently saw significant volatility in its price. After a strong rally that pushed the price of HNT to $4.5 on April 12, the altcoin retraced by about 24%, bringing the price back down to $3.4. While this retracement might raise some concerns for traders, the overall market structure and potential future movements suggest that HNT could be preparing for its next significant move.

Bullish Momentum and Market Structure Break

The most recent surge for Helium came after the coin broke past a key resistance level of $3.4, which had been acting as a lower high since late January. This break marked the end of a prolonged downtrend, signaling the potential for a bullish reversal. The rally reached its peak at $4.5, a strong 30% increase from the breakout point. However, as the market typically behaves, this sharp rise was followed by a pullback.

Despite the 24% retracement, the overall bullish market structure of HNT remained intact, which is important for long-term traders looking to spot potential trends. The pullback has brought HNT back to familiar levels, such as the $3.4 price point, which is acting as support for now.

Key Support and Resistance Levels for HNT

Traders are closely monitoring several key levels to predict where HNT might head next. The immediate support level for the altcoin lies at $3. This level could be crucial in determining whether the retracement will stop here or continue further. Below that, the next significant support comes at $2.25, which could act as a strong base if market conditions worsen.

Resistance levels are also essential in understanding the potential for future rallies. The $3.7 price point is currently acting as a key resistance zone, having been a struggle for HNT to surpass in recent days. If the price can break above this level, it could open the doors for a return to the highs of $4.5, or potentially even higher if the buying pressure intensifies.

The Role of Bitcoin in HNT’s Price Movements

Bitcoin’s (BTC) price movements often play a significant role in influencing altcoins like Helium. Currently, the broader cryptocurrency market is showing signs of uncertainty, particularly with Bitcoin’s price hovering around the $83,000 mark. If Bitcoin were to experience a significant drop, such as dipping below $83,000, it could fuel a wave of selling across the market, including Helium.

In such a scenario, traders should prepare for a potential downturn in HNT’s price, with the altcoin possibly falling to the $2.75-$3 range. On the other hand, if Bitcoin can stabilize or increase, it may provide the upward momentum needed for HNT to break through its resistance levels and resume its bullish trend.

On-Chain Metrics and Market Sentiment

The On-Balance Volume (OBV), an indicator used to measure the buying and selling pressure in the market, has been showing some mixed signals. Although the OBV rose significantly during the initial breakout, it has struggled to make new highs in recent days. This suggests that the buying pressure behind HNT’s recent rally may be weakening.

Despite this, there are still signs of hope. If the OBV can turn around and establish an uptrend, it could indicate renewed buying interest, helping to propel HNT past its resistance levels and potentially into a new uptrend. Traders should keep an eye on this metric in the coming days as it could provide early signs of the next direction for HNT’s price.

4-Hour Chart Analysis: RSI and Momentum Indicators

On the shorter timeframes, the 4-hour chart provides some interesting insights into HNT’s current price action. The Relative Strength Index (RSI), which measures the speed and change of price movements, has shown signs of slowing momentum over the past week. This suggests that the bullish momentum from the initial rally may be fading, and a potential consolidation phase could follow.

Additionally, the RSI has struggled to break through the 50 mark on the 4-hour chart, indicating that HNT is currently in a neutral-to-bearish phase. The price action has also highlighted a bearish breaker block at $3.7, which has acted as resistance in recent days. A failure to break above this level could result in further consolidation or a price dip.

What’s Next for Helium?

Helium’s future price action will depend largely on how the broader cryptocurrency market, especially Bitcoin, behaves in the short term. If Bitcoin remains stable or experiences upward movement, HNT could see renewed buying pressure and potentially break through its resistance at $3.7. On the other hand, if Bitcoin faces a drop, HNT could face further retracement, with potential support levels around $2.75-$3.

Overall, traders and investors should remain cautious and monitor key levels closely, as Helium’s next steps will be highly influenced by both market sentiment and external factors like Bitcoin’s price movements. The altcoin has shown strong potential in recent weeks, but its ability to maintain upward momentum will depend on the continued strength of the market and investor sentiment.