HYPE pauses price discovery after its ATH

Key takeaways

HYPE is up 48% in the last 30 days, overtaking several cryptocurrencies to grab the 11th spot in the market.
The coin risks turning the $40 support into a resistance following its recent all-time high achievement.

HYPE down 12% from all-time high

HYPE, the native coin of the Hyperliquid ecosystem, has been one of the top performers in recent weeks. The coin, which launched seven months ago, has added over 1,000% to its value since then and is now the 11th-largest cryptocurrency by market cap.

It surged by 48% over the last 30 days to reach an all-time high price of $45 yesterday. However, it has lost roughly 12% of its value since then and has dropped below the $40 support level, with the bears still in control.

Profit-taking and the Middle East crisis are the major catalysts behind HYPE’s dip

With HYPE losing over 12% of its value in the last 24 hours, analysts are predicting further downward movement in the near term. The primary catalysts behind HYPE’s bearish performance are the ongoing conflict in the Middle East and potential profit-taking.

As stated above, HYPE reached an all-time high price of $45 on Monday, up 48% over the last 30 days. This has seen some investors take profit after an extended period of rally.

According to data obtained from CoinGlass, HYPE’s Open Interest (OI), which represents the number of active futures and options contracts yet to be settled or closed, has declined by nearly 8% to $1.91 billion over the past 24 hours.

A decrease in OI signals declining interest in HYPE and the lack of trader conviction in the price discovery phase. 

In addition to the profit-taking, the ongoing crisis in the Middle East is affecting Bitcoin, Hyperliquid, and the broader cryptocurrency market. With the $40 support now broken, traders could be looking at the next major support level around $36.

HYPE eyes the $36 support level

With the broader cryptocurrency now bearish, HYPE has shifted bearish, at least in the short term. The sell signal from the Moving Average Convergence Divergence (MACD) indicator on the 4H chart shows that sellers are currently overpowering buyers in the market.

The blue line is set to cross below the red signal line, indicating a strong bearish momentum. Furthermore, the Relative Strength Index (RSI) has dropped from the overbought territory and is now heading into the 50 midline, signaling a firm bearish grip.

With the $40 support level now broken, the next key support is at around $36.00, with the 50-day Exponential Moving Average (EMA) set at $32.01 and the 100-day EMA at $27.41.