Hyperliquid (HYPE) Price Decline Intensifies With 50% Drop, Losing Key Support

Key Takeaways

• HYPE’s price has reached the oversold level, but a rebound is unlikely due to bearish momentum.
• The demand for the Hyperliquid token has also weakened, with social dominance continually falling.
• HYPE’s price trades below the $15.06 support and indicators show that the value could go lower.
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After a mild bounce to $14.85 three days ago, Hyperliquid’s (HYPE) price has flashed a red candlestick for the second consecutive day. This decline has left HYPE’s 30-day performance at a 50% fall.

This makes it one of the worst performers out of the top 100. The steep drop has also shaken confidence in the market, especially as HYPE was one of the top performers some months back.

Is HYPE near the bottom, or is this the beginning of a prolonged bearish trend?

HYPE Goes from $35 to $13, Now Oversold

Hyperliquid’s price, which was $35 last December, trades below $13 today. This decline aligns with CCN’s previous analysis, which predicted an extended correction.

According to the daily chart, the Relative Strength Index (RSI) shows this decline has placed HYPE at an oversold region. The RSI measures momentum using the speed and size of price changes.

It also shows when an asset is overbought or oversold. An asset hit the overbought region when the RSI reading is above 70.00.

Conversely, a reading less than 30.00 means it is oversold. On the daily HYPE/USDT chart, the RSI has dropped to 23.52.

Similarly, HYPE’s price has dropped below the $19.58 support, while retesting the $26.33 resistance is challenging.

Furthermore, despite being oversold, HYPE will unlikely see a bullish turnaround soon. One indicator supporting this bias is the Awesome Oscillator (AO), which also measures momentum

As of this writing, the AO reading is negative, indicating bearish momentum. Therefore, if the trend continues, HYPE might fail to rebound in the short term.

Social Dominance Drops

Amid this price action, the social dominance around HYPE has fallen. Social dominance measures the level of discussions around a cryptocurrency.

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When it rises, it means that the asset is getting a lot of attention, which could fuel increased demand. However, according to Santiment, HYPE’s social dominance has dropped to 0.558%, indicating low market interest.

If this remains the same, then demand for the token might continue to fall, possibly negatively affecting the price.

HYPE Price Analysis: Correction Not Over

Looking at the daily chart again, CCN observed that the Ichimoku Cloud has risen above HYPE’s price. The Ichimoku Cloud shows if a cryptocurrency has found support or is at a resistance level.

When the cloud is below the price, it indicates support, indicating that the price can increase. However, if the cloud is above the price, it represents resistance.

As of this writing, the resistance around $21 has pushed HYPE’s price further down, leading to a drop below the key support near $15.06.

With no buying pressure, HYPE is likely to continue its correction. If validated, the cryptocurrency’s value might drop to $10.23.

However, if the token reclaims the $15.06 support and rises past $21, this decline might not happen. Instead, HYPE’s price might climb to $28.43 near the 0.786 Fibonacci level.