Hyperliquid is becoming a focal point for cryptocurrency investors, not only due to its outstanding performance but also because of the strong reception from large 'whales' in the industry.
The native token of this platform, HYPE, is also witnessing a surge in interest – particularly after its recent spectacular price increase. Since the beginning of April, HYPE has continuously climbed, hitting a new historical peak of over $44 on Wednesday – equivalent to a more than 365% increase from the low established at the beginning of the year.
However, the bullish momentum seems to be slowing down as buying pressure gradually weakens. This is reflected in the negative divergence signal between the price and the RSI indicator – often an early warning sign of a potential deeper correction.
Nevertheless, institutional investors and whales seem to have no intention of withdrawing. The latest data shows they continue to accumulate HYPE, contributing to the current upward momentum. The MFI (Money Flow Index) indicator also confirms this trend as the inflow of money has surged continuously over the past five days.
Is market sentiment gradually turning negative?
The price of HYPE continues to maintain impressive strength, but the RSI index is trending weaker – reflecting that the growth momentum is gradually fading. This could be an early signal for a correction in the second half of June.
On-chain data also begins to show that selling pressure is increasing. Notably, the volume of Long liquidations for HYPE surged to 2.11 million USD during Friday's trading session – more than double the Short liquidations, which barely reached 900 thousand USD on the same day.
This trend is even more evident when observing the data from the past 7 days: Long positions have been liquidated significantly, while Short positions have decreased sharply. This development reflects a significant change in market sentiment.
At the same time, the open interest (OI) has just set a new peak, reaching 1.90 billion USD in the last 24 hours. This indicates that large amounts of money are seeking liquidation opportunities to take profits.
Additionally, the trading volume of derivatives on June 14 soared to 3.3 billion USD – the highest ever recorded in a single day, further supporting the hypothesis that the market is entering a phase of high volatility.
The question now is: will the aforementioned signals continue to ignite demand for HYPE, or simply indicate the extreme sensitivity of this token to large-scale liquidations? The answer may lie in the factors that have driven the strong wave of interest in Hyperliquid over the past two months.
Does the performance of Hyperliquid accurately reflect the value of HYPE?
Not only did it attract attention by setting a new price peak last week, but the Hyperliquid ecosystem also recorded a series of impressive records in many important metrics.
Specifically, the stablecoin liquidity on this platform has surged, reaching 3.88 billion USD on Thursday – although it later experienced a slight adjustment. At the same time, the total value locked (TVL) on Hyperliquid's layer 1 network also soared to a record high of 1.795 billion USD in the last 24 hours, demonstrating robust and sustainable growth of the project.
The core factor driving this increase comes from the fact that Hyperliquid's DEX is increasingly being embraced by the community. A clear indication is that the trading volume on the DEX has made an impressive recovery: from a low of only 50.9 million USD on April 5, this figure has skyrocketed and set a new peak of over 735 million USD on Friday.
The explosive growth of Hyperliquid this year shows that the layer 1 network is effectively harnessing the inflow of money into the entire ecosystem – and that value is gradually spreading, permeating into the price of HYPE in a clear way.
What has driven the strong increase of HYPE?
In addition to the demand from large institutions as previously analyzed, HYPE also possesses high utility as it is used for payments, project management, providing liquidity, and staking to create a source of passive income for holders.
These fundamental factors will play a key role in shaping the price trend of HYPE in the coming weeks. If metrics like total value locked (TVL) and trading volume on decentralized exchanges (DEX) continue to maintain growth, it will bolster investor confidence and help mitigate the risk of price corrections.
Conversely, in the scenario where these metrics decline sharply, HYPE may face a wave of profit-taking and significant selling pressure, leading to the risk of a deep correction in the short term.