HYPE Surges 20% in a Week; Force Behind Rally Now Threatens Reversal

Hyperliquid's token, HYPE, has seen a significant rally, surging over 20% in the past week and nearly 50% year-to-date, following a breakout from an inverse head-and-shoulders pattern with a theoretical target near $44.

However, technical indicators suggest momentum is slowing. A bearish divergence exists between price and the RSI on the 12-hour chart, and the Chaikin Money Flow (CMF) shows weakening capital support despite rising prices. Furthermore, exchange flows indicate that the rally was not supported by strong spot accumulation; instead, net inflows suggest coins moved onto exchanges, often preceding selling pressure.

The primary force behind the surge appears to be a short squeeze in the derivatives market, evidenced by a 3.5-to-1 imbalance favoring long leveraged positions on Binance. This heavy long concentration now poses a risk, as a modest price drop could trigger cascading long liquidations, fueling a reversal. Key levels to watch are resistance near $37 (with a target of $42-$44 if broken) and support near $35; a break below $29 would invalidate the current bullish structure.

(Source：BeInCrypto)