$HYPE Token Faces Renewed Downside Pressure
HYPE, the native token of Hyperliquid, has remained under heavy pressure over the past few months. After peaking at a record $60 in September, the token has fallen sharply to around $25.8, marking a steep 56% decline. The recent price action suggests that bearish momentum is far from over.
Beyond the broader crypto market weakness, HYPE has formed multiple high-risk technical patterns, increasing the probability of further downside in the near term.
š Technical Indicators Signal Bearish Continuation
On the daily chart, HYPEās decline began shortly after forming a head-and-shoulders pattern, a classic bearish reversal signal. The sell-off accelerated once the token broke below the 61.8% Fibonacci retracement level at $28.5, reinforcing the negative outlook.
š The price now trades below all key moving averages, a strong indication that sellers remain firmly in control. In addition, HYPE has formed a bearish flag pattern, typically characterized by a sharp drop followed by a weak upward channelāoften preceding another leg lower.
The token also continues to trade below the Supertrend indicator, further validating the bearish bias.
š® Outlook:
The most likely scenario points toward a drop to $20, representing roughly 22% downside from current levels. However, a sustained move above $28 would invalidate the bearish structure and signal potential trend reversal.
āļø Hyperliquidās Perpetual DEX Faces Intensifying Competition
Market-wide weakness has played a key role in HYPEās decline. Bitcoin has retreated from its October high of $126,200 to around $95,000, while major altcoins like Ethereum and Cardano have also posted significant losses.
At the same time, Hyperliquidās on-chain metrics have weakened amid rising competition in the perpetual futures market.
š Data from DeFi Llama shows total perpetual futures volume has fallen from $1.32 trillion in October to $521 billion this month. Hyperliquidās own trading volume declined sharplyāfrom $396 billion in August to just $94 billionādragging monthly fees down to $36 million, well below last yearās $144 million peak.
š Rivals Gain Ground as Hyperliquid Loses Dominance
Competition has intensified rapidly. Over the past 30 days:
ā¢ Aster processed more than $123 billion
ā¢ Lighter handled around $118 billion
ā¢ Grvt recorded roughly $40 billion
ā¢ Hyperliquid processed about $145 billion
Once the undisputed leader, Hyperliquid is now facing sustained pressure from multiple fast-growing rivals.
š TVL and Stablecoin Supply Continue to Shrink
Further weakness is visible in Hyperliquidās ecosystem metrics. Total value locked (TVL) on its layer-1 network has dropped to $2.65 billion, down from an all-time high of $8.35 billion. Meanwhile, stablecoin supply has fallen to $4.9 billion, compared with a peak of $6.2 billion.
š These declines directly impact HYPE token buybacks and burns, as the protocol relies on network fees to repurchase and destroy tokensāan important mechanism for reducing circulating supply.
š§ Bottom Line
With weakening technicals, falling on-chain metrics, and rising competition, HYPE remains vulnerable in the short term. Unless key resistance levels are reclaimed and network activity rebounds, downside risks are likely to persist.
