Hyperliquid (HYPE) faces the risk of a sharp decline as demand weakens

2025-12-09 13:04:30

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Hyperliquid (HYPE) fell another 3% on Tuesday, extending its correction streak to a sixth consecutive session. Derivatives data continues to reflect cautious sentiment as liquidation pressure on (Long) positions increases, indicating that capital is seeking to avoid risk. The technical picture remains bearish, raising the probability that HYPE could retreat to the support zone around $20.

Derivatives market demand dries up

Hyperliquid is gradually losing the attention of retail investors as the cryptocurrency market softens ahead of the US Federal Reserve’s (Fed) interest rate cut decision at 2 a.m. Thursday (Vietnam time). According to data from CoinGlass, HYPE futures open interest (OI) has dropped 5.91% over the past 24 hours, down to $1.44 billion. This decline shows that liquidity in the HYPE derivatives market is shrinking, as most traders are choosing to stay on the sidelines and adopt a “wait and see” strategy.

At the same time, the total value of liquidated Long positions over the past 24 hours reached $1.28 million, much higher than Short liquidations of only $88,160, indicating clear downward pressure is dominating.

HYPE derivatives data | Source: CoinGlass## Hyperliquid could head toward $20 as selling pressure increases

Hyperliquid continues its correction after being rejected at the resistance line formed by the double tops on October 30 and November 18 on the daily chart. At the time of writing, HYPE is trading below $30 on Tuesday, lower than the November 22 low of $29.37.

If the price decisively closes below this support zone, the downtrend could extend to the S1 Pivot at $26.03, before targeting the October 10 low around $20.84.

Daily HYPE/USDT chart | Source: TradingViewIn a more negative scenario, the 50-day EMA crossed below the 200-day EMA last Thursday, forming a “death cross” signal—an indication that short-term selling pressure is outweighing the medium-term trend.

Other technical indicators also lean bearish. The RSI (at 34) continues to fall into oversold territory, reflecting a clear advantage for the bears. At the same time, the MACD signals stronger downward momentum as both the MACD and signal lines dip further into negative territory after Saturday’s crossover.

To restore a bullish structure, HYPE needs to reclaim the $30 level and then break through resistance around $34.

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