Hyper Liquid (HYPE) continues to be under strong selling pressure as price trends remain bearish. Altcoins are struggling to regain momentum following last week’s market correction.
A growing bearish mood in futures markets is exacerbating the decline, with traders betting aggressively on a recovery.
Hyper-liquidity traders are bearish
Hyperliquid’s funding interest rate has fallen to the lowest level in six months, indicating a sharp rise in bearish mood. The funding ratio measures the balance between long and short positions in the futures market. Negative funding rates indicate a predominance of short-term contracts, and this scenario is now clearly seen in HYPE.
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This trend suggests that futures traders expect the value of the token to fall further and stand to profit from the decline. The continued dominance of shorts over longs underscores the lack of confidence in a near-term recovery.
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At the macro level, the Moving Average Convergence Divergence (MACD) indicator recently showed signs of a potential bullish crossover. However, the signal failed to materialize as the selling momentum strengthened and pushed the indicator further into negative territory.
The increasing divergence between the MACD lines suggests further downside to come. Unless momentum changes meaningfully in buyers’ favor, HyperLiquid may continue to struggle. The decline in altcoin volume also supports this outlook.
The downward trend of HYPE price strengthens
HYPE is trading at $38.8 at the time of writing, just below the key support level at $38.9. The current downtrend suggests further downside potential in the near term.
In the short-term time frame, HYPE could fall towards the $36.7 support level. Losing this line of defense could trigger further selling, and the price could fall further to $35.7 if bearish sentiment among investors persists.
Conversely, if HYPE manages to sustain above $38.9 and attract fresh buying activity, it could rise above $40.2 and challenge the downtrend. A definitive breakout above $43.5 could invalidate the bearish theory and signal a trend reversal.
