Helium HNT Drops 5.42% Amid Bearish Pressure But Bullish Pattern Hints At Rally

Helium, a decentralized wireless network, has experienced a 5.42% drop in the past 24 hours, with its price falling to $3.04. This decline is attributed to increased bearish pressure, particularly from spot traders who have been selling HNT consistently over the past three days. The selling pressure has resulted in over $116,000 worth of HNT being sold, with more than $78,000 offloaded in the past 24 hours alone. This selling pressure is not limited to the spot market; derivative traders are also contributing to the price drop, as indicated by a 3.17% decline in Open Interest and a 17.79% decrease in volume.

Despite the bearish sentiment, market analysts suggest that this move by spot traders could ultimately benefit HNT, potentially leading to a significant rally in the coming trading sessions. HNT is currently trading within a bullish triangle pattern, formed by a converging descending resistance line and a horizontal support level on the 4-hour chart. A breakout above this pattern typically triggers a rally, leading to higher highs and lows. If HNT reaches the support level and starts trending higher, its bullish move could begin with a 79.15% upside.

The market remains bullish despite the selling pressure. The Open Interest Weighted Funding Rate, which analyzes unsettled contracts and the premiums traders pay to maintain price levels in both the spot and futures markets, suggests a bullish outlook. This metric has remained in bullish territory since February 19, signaling that the ongoing back-and-forth price action within the bullish channel is likely an accumulation phase. Additionally, the 24-hour derivatives trading volume has been dominated by buyers, as indicated by the Long-to-Short Ratio, which was 1.021 at press time. A reading above 1 suggests there are more buyers than sellers in the market.

Overall, the current decline in HNT's price is likely a strategic move by traders to fill more orders at lower prices before a major price swing occurs. The combined selling pressure from both the spot and derivatives markets will likely reach a halt at HNT’s bullish pattern support level, from which a rally could begin. This strategic move by traders could ultimately benefit HNT, leading to a significant rally in the coming trading sessions.