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The cryptocurrency market continues to deliver dramatic twists, and this week, Hyperliquid [HYPE] finds itself at the center of a highly watched event. A newly created wallet deposited $1 million worth of USDC into Hyperliquid and quickly acquired over 25,500 HYPE tokens, even as the asset experienced a steep decline. This bold accumulation, set against a backdrop of long liquidations and wavering trader confidence, has stirred debate over whether bulls might soon reclaim control—or whether further declines lie ahead.
As of press time, HYPE was trading around $38.20, reflecting a drop of more than 6% over the past 24 hours. While such a move might typically point to waning momentum, the timing and size of the $1 million investment suggest some traders see the dip as an opportunity rather than a warning. This buying activity unfolded as overall market sentiment turned notably bearish, and volatility surged across major altcoin pairs.
Sentiment Hits New Lows as Liquidations Accelerate
According to on-chain analytics platform Santiment, sentiment around HYPE has dropped significantly, hitting its lowest level in over two months at just 18.02. This reading points to heightened fear and uncertainty among traders. Historically, such sharp sentiment declines have preceded both sharp rebounds and deeper corrections, depending on follow-through from buyers or sellers in the following days.
In addition to the bearish mood, Hyperliquid faced a massive wave of long liquidations. Data from CoinGlass indicates that more than $932,000 in long positions were wiped out in the past 24 hours, while short liquidations remained minimal at just $43,000. Hyperliquid alone accounted for $561,000 of those liquidated long positions, revealing just how many leveraged traders were betting on the price holding or rising. Instead, HYPE broke below a key support level, catching many off guard and triggering a cascade of liquidations.
Break of Support Flips the Trend Bearish
HYPE had been trending within an ascending price channel for weeks, with repeated attempts to hold the $40–$43 range. However, the recent sell-off pushed prices below this trendline, erasing the prior bullish structure and raising the possibility of deeper losses. Technical analysis suggests that HYPE now faces downside risk toward $36.86 as an immediate support, with $30.86 acting as the next major level if bearish pressure increases.
Adding to the caution, the Stochastic RSI is pointing lower, a signal that short-term momentum may continue to favor sellers. For bullish traders hoping to regain control, a move back above $40 is now essential. Reclaiming that psychological level could help reverse the bearish narrative and potentially initiate a short squeeze if resistance zones are tested.
Short Liquidation Zones Could Trigger a Price Rebound
Despite the price slipping below support, all eyes are now on the $40 mark. According to the latest liquidation heatmap from CoinGlass, a dense cluster of short positions exists between $40 and $42. If bulls can generate enough buying pressure to push HYPE above $40, it could force those short traders to cover their positions, resulting in a wave of forced buying that drives prices even higher.
This setup creates a high-stakes environment for both sides. For now, bears remain in control, with the current price of $38.22 hovering just under the critical short liquidation zone. However, the large inflow of $1 million and clear accumulation by a new whale wallet suggest some investors are betting on a reversal—perhaps sooner rather than later.
Key Levels to Watch in the Coming Days
The next few trading sessions could prove pivotal for HYPE. On the downside, the $36.86 level is now acting as immediate support, with any breakdown below this potentially opening the door to a fall toward $30.86. On the upside, bulls need to reclaim the $40–$42 area quickly to shift sentiment and technical structure back in their favor.
For traders and investors alike, the situation is a classic mix of fear, opportunity, and volatility. While liquidations and sentiment suggest a market under stress, contrarian buyers are stepping in, hoping to capitalize on what could be a short-term market bottom. Whether HYPE will find solid ground or continue its downward trend remains to be seen, but the setup around the $40 zone could offer critical clues for what comes next.
In a broader sense, the Hyperliquid ecosystem remains one of the more volatile altcoin environments. As more institutional capital and high-risk bets enter the market, investors are encouraged to remain cautious and use proper risk management. Still, the recent activity suggests that HYPE remains a token to watch, especially as market participants evaluate whether this dip was just another shakeout—or the beginning of a deeper correction.
