NEAR Protocol (NEAR) is showing signs of potential recovery after breaking out of a two-year bearish trendline. The blockchain platform, which has gained significant traction due to its innovative sharding technology, has been positioning itself as a scalable alternative to Ethereum. Despite its current price being significantly below its all-time high, NEAR is now on a path toward testing the $20 mark again. However, whether it can maintain its momentum or face another correction hinges on key support and resistance levels in the coming weeks.

A Strong Breakout Signals Potential Upside

NEAR’s price has surged recently, trading at $6.69, marking a 3.11% increase in the last 24 hours. Despite still being 68% below its all-time high of $20.42 reached in January 2022, the current technical and market conditions suggest that the protocol could see substantial upside in the near future. A break above key resistance levels, such as $8.00, could set the stage for a retest of its previous high.

The underlying technology driving NEAR’s success is its sharding capability, which enhances scalability and positions the protocol as a strong competitor to existing blockchains like Solana. With the backing of tech giant NVIDIA and increasing interest in AI-driven applications, NEAR could see exponential growth, further boosting its chances of revisiting the $20 mark.

Key Support and Resistance Levels to Watch

For NEAR to have any chance of hitting the $20 mark again, it must overcome several technical hurdles. The immediate resistance zone lies just above its current price near the $8.00 mark. This area has been a point of consolidation for the token, and any failure to break above it could result in further price stagnation or even a correction.

On the downside, NEAR has solid support at $6.00, which aligns with previous resistance turned support. If the price holds above this level, it could provide a solid foundation for another attempt at breaking through the $8.00 resistance. A failure to maintain $6.00, however, could see NEAR testing lower levels at $4.00 or even as low as $1.50, which represents a critical long-term support zone.

Momentum Indicators Show Mixed Signals

Looking at the momentum indicators, NEAR’s path forward remains uncertain. The Supertrend indicator, which tracks the direction of the market, currently shows a bearish bias, with resistance at $7.306. This indicates that NEAR is still in a struggle to break free from its bearish momentum. A sustained breakout above this resistance could signal a shift toward a more bullish outlook, but for now, the token remains under pressure.

Other momentum indicators also show signs of ongoing downward pressure. The True Strength Index (TSI) is still in negative territory, indicating that bearish momentum persists. However, the narrowing gap between the signal line and the momentum line suggests that selling pressure is weakening, and NEAR may be nearing a reversal if the broader market conditions support it.

On a more positive note, the Accumulation/Distribution (A/D) Line shows mild accumulation, indicating that buyers are starting to show interest in the asset. While this is not a definitive signal of a bullish trend reversal, it does suggest that market participants are starting to position themselves for potential upside.

Surge in NEAR’s Volume and Fees Indicates Growing Interest

One of the most encouraging signs for NEAR’s price action is the surge in its trading volume and transaction fees. Beginning in mid-November, NEAR saw a steady increase in volume, which peaked in early December. This upward trend reflects growing network activity, likely driven by increased interest in NEAR’s technology and its expanding ecosystem.

Alongside the volume surge, transaction fees have also been rising, indicating that more users are interacting with the network. This alignment between volume and fees demonstrates healthy on-chain activity and suggests that the platform is gaining real-world adoption. As more developers and users engage with the protocol, NEAR’s upward trajectory could gather more momentum, potentially leading to higher prices.

Liquidations Reveal Bullish Bias

A review of NEAR’s liquidation map highlights that there is significant bullish sentiment in the market. Long liquidations, in particular, have been increasing since the price rose above $6.45, with over $9 million at risk as NEAR approaches $6.67. This indicates that traders are betting on an upward movement in the token, and if the price continues to rise, it could trigger further bullish liquidations, potentially accelerating the rally.

On the short side, however, the liquidation activity has been more subdued. With fewer bearish positions being liquidated, this suggests that the market is currently more focused on upward price potential than downward risk.

What’s Next for NEAR?

Looking ahead, NEAR Protocol is at a critical juncture. If it can maintain its current momentum and successfully break through the $8.00 resistance, the path to $20 will become more likely. The protocol’s strong fundamentals, increasing network activity, and growing adoption in AI and scalability-focused applications could be enough to fuel this move. However, NEAR must overcome key resistance zones and hold strong above critical support levels to ensure sustained upward movement.

For now, traders and investors should closely monitor the $6.00 support level and the $8.00 resistance. If NEAR can break through $8.00, it may very well be on its way to testing its all-time high of $20 once more. However, if the price fails to hold the $6.00 support, a deeper correction toward $4.00 or even lower could be in store.