HNT has retraced 36% from the July high! The third Helium Halving starts today, can the deflationary model turn the tide? | HNT price prediction

Question

The Helium Token HNT has experienced a significant dumping ahead of the third Halving (effective on August 1st Beijing time), with the price plunging 36% from the mid-July high of $4.03 to currently $2.95, a drop of 94% from its all-time high of $54.88. Although the 24-hour volume has risen by 31.2% to $14.7 million, the 12% decrease in open contracts for derivation suggests long positions may be closing or liquidated. This Halving will reduce the annual issuance of HNT from 15 million tokens to 7.5 million tokens, aimed at establishing a long-term deflationary model, but in the short term, technical indicators remain bearish overall, with $2.85 becoming a key support level.

1. Big dump before Halving: HNT fell 36% this month, long positions retreat in the derivation market The price of HNT continues to decline, with a 24-hour drop of 12% and a weekly drop of nearly 20%. The current price of $2.95 has shrunk by 94% compared to the historical high in November 2021. Market volatility signals include:

Spot Volume Decline: 24-hour volume increased to 14.7 million USD (+31.2%), showing typical characteristics of "panic dumping".
Long Positions in Derivatives Exit: Futures volume rose by 15.8% to 6.37 million USD, but open interest plummeted by 12% to 5.96 million USD, indicating that a large number of long positions actively closed or were forcibly liquidated.

2. Halving Mechanism Analysis: Annual Inflation Rate Halved, Activating Subnet Governance Game This halving is implemented based on the HIP-20 proposal and is the core deflationary mechanism of the Helium economic model:

Supply sharply reduced: Daily new HNT decreased from about 41,000 coins to 20,500 coins, and annual issuance was halved from 15 million coins to 7.5 million coins.
Reward Structural Adjustment:
Proof of Coverage Rewards (PoC): Passive mining income Halving immediately, affecting regular Hotspot operators. * Data Transmission Rewards: Rewards based on actual network usage (mobile/IoT subnet) are not affected, benefiting active nodes.
Governance Countdown: veHNT holders (users who stake HNT to gain governance rights) must complete re-delegation by August 1 to maintain reward eligibility and participate in the HNT allocation decisions between mobile/IoT subnets.

3. Technical Warning: Moving averages in bearish arrangement, oversold rebound must hold steady at 2.85 USD Although Halving is favorable for long-term deflation, the short-term technical structure is still showing signs of deterioration: * Moving Average Pressure: The price is below the 10-day to 200-day EMA, with only the 50-day SMA providing weak support, forming a standard bearish arrangement.

Momentum indicators bearish: MACD and momentum indicators issue sell signals, and the Relative Strength Index (RSI) has fallen to 43 (neutral but trending weak).
Oversold Recovery Opportunity: The stochastic indicator %K value falls below 6 entering the oversold zone, combined with the ADX indicator 35 showing a strong downward trend. If the price can hold steady at the $2.85 key support and is accompanied by increased buying volume, it may trigger a technical rebound.

Conclusion: The third Halving of Helium has strengthened the deflationary properties of HNT from a mechanism perspective (annual issuance reduced to 7.5 million tokens), but has not boosted market confidence in the short term. The price has plummeted to historical lows, long positions in derivation have retreated, and the technical indicators are under significant pressure, highlighting the market's skepticism about the immediate positive effects of the Halving. Whether the downturn can be reversed depends on two key factors: 1) the defensive strength of the $2.85 support level, and whether an oversold corrective rebound can take shape; 2) whether the network's activity (especially the data usage of the mobile/IoT subnet) and veHNT governance participation can improve after the Halving, to validate the actual value support of the deflationary model. For investors, it is essential to be cautious of the possibility that downward risks have not been fully released before the technical trend becomes clear.