HYPE Crypto Drops Sharply Amid Weak Charts and Soaring Liquidations

TLDR

• HYPE has plunged 40% from its yearly peak, entering a clear bearish phase.
• Over $26M in long positions were liquidated within the past 24 hours.
• Hyperliquid’s 24-hour trading volume fell to $11.2B, below rival Aster.
• The ADX reading near 30 shows the downtrend is gaining strong momentum.

HYPE, the native token of the Hyperliquid network, is facing renewed selling pressure after a steep 40% decline from its yearly peak. The token has dropped below key support zones, while trading indicators continue to signal growing weakness. Rising liquidations and shrinking market share among perpetual futures exchanges are deepening concerns among traders about further downside risks for HYPE in the near term.

HYPE Price Extends Its Bearish Trend

The HYPE token has entered a bear market after dropping from $59 in September to about $35. This downward move follows the broader decline across the cryptocurrency market, which has affected most altcoins. The token’s recent fall brought it to the 50% Fibonacci retracement level, suggesting a potential continuation of the downward trend.

The chart also shows that HYPE has slipped below the lower boundary of the megaphone pattern that had formed between May and October. This pattern, which is often considered a bullish continuation signal, has now been invalidated. The breakdown points to weakened momentum, with the token struggling to hold above earlier support areas.

Technical Indicators Point to Continued Weakness

Several technical indicators are showing bearish signs for HYPE. The token has moved below its 50-day Exponential Moving Average (EMA), reflecting reduced buying strength. At the same time, the Supertrend indicator has turned red, while HYPE now trades beneath the Ichimoku cloud, a setup often associated with downward momentum.

The Average Directional Index (ADX) has risen to 30, suggesting that the current downtrend is gaining traction. If the token fails to hold above the support level of $31.68—its lowest price recorded on Friday—analysts expect further losses. Any sustained move below this area could trigger an extended decline, especially as overall market sentiment remains weak.

A possible recovery could occur only if HYPE moves back above the lower edge of the megaphone pattern. In that case, the token might retest the $50 zone, a key psychological resistance level. However, current momentum favors sellers as technical conditions remain fragile.

Liquidations Surge as Traders Exit Leveraged Positions

Elevated liquidation levels have added pressure to HYPE’s price. Data from trading platforms show that long positions worth over $26 million were liquidated within the last 24 hours. Although this is less than the $830 million liquidated across the market on Friday, it shows that leveraged traders continue to face heavy losses during this correction.

Many of the 1.6 million traders liquidated last week are expected to stay cautious in the short term. The fear of further margin calls could reduce participation from both retail and institutional traders, leaving liquidity thinner and volatility higher in the near term.

Hyperliquid’s Market Share Declines Amid Rising Competition

Another factor weighing on sentiment is the loss of market share by the Hyperliquid exchange. Recent data shows that the network processed $11.2 billion in trading volume in the past 24 hours, slightly below the $11.24 billion recorded by rival exchange Aster. Other competitors such as Lighter, edgeX, and ApeX Protocol reported $2.7 billion, $2.37 billion, and $2.33 billion in daily volumes, respectively.

Hyperliquid had previously maintained a larger lead over these platforms, but the recent decline in volume suggests traders are diversifying across newer exchanges. The reduced activity could continue to influence HYPE’s liquidity and trading stability, especially if market volatility remains high.