Helium’s recent surge could signal the start of a major price rally, with technical indicators pointing to further gains.
Helium (HNT) has surged 228% from its August lows, reaching a critical resistance level of $9.52 on December 15, pushing its market valuation to $1.6 billion. Technical analysis suggests that Helium could be entering a strong growth phase, with potential for higher prices in the coming weeks.
Strong Demand in the Futures Market
One of the key factors driving this rally is the rising open interest in Helium futures, indicating increasing investor interest. According to CoinGlass, open interest climbed to over $11 million on Sunday, up from $9.35 million the previous week. This surge in interest, particularly on platforms like Bitget and OKX, suggests strong demand and confidence in the asset.
Open interest, which tracks the number of unfilled buy and sell orders in the futures market, often increases when an asset is seeing heightened demand. This indicates that investors are positioning themselves for further price movement, signaling potential upside for HNT.
Rising Token Burn and Network Upgrades
Another important factor in Helium’s recent surge is the increasing burn rate of HNT tokens. Over $250,000 worth of HNT was burned in November, reducing the circulating supply of the token. This reduction in supply, coupled with growing demand, can put upward pressure on the token’s price. Tokens are burned to access data credits on the Helium Network, which is critical to the platform’s functionality.
Additionally, the recent community vote on HIP 139, which phases out rewards for the Citizen Broadband Radio Service (CBRS), has also positively impacted Helium’s price. The proposal is expected to streamline the network by transitioning equipment to stock firmware, creating long-term growth opportunities for Helium and enhancing the overall network efficiency.
Technical Analysis: Breakout on the Horizon?
Looking at the technical chart, Helium’s price has been trending upward, jumping from $5.22 earlier this month to $9.52. This price level is critical, as it has previously acted as a resistance point on December 2 and December 7. However, the recent price action suggests that a breakout above this resistance is becoming increasingly likely.
Helium has remained above its 50-day and 25-day moving averages, indicating a bullish trend. Additionally, the price has moved slightly above the middle line of the Andrew’s pitchfork tool, a technical indicator used to predict price trends. If Helium breaks through the $9.52 resistance level, it could invalidate the triple-top pattern and pave the way for further gains.
