HYPE Faces Pressure Below 50-Day EMA, Retail Demand Dips

Key Insights

• HYPE’s price continues to struggle below the 50-day EMA, signaling a weakening market outlook.
• Futures Open Interest drops 2% as long liquidations dominate over shorts, indicating a bearish shift.
• The MACD and RSI show growing bearish momentum, suggesting further downside potential for Hyperliquid.

Hyperliquid (HYPE) has dropped to its 50-day Exponential Moving Average (EMA) at $28.85, continuing a downward trend that marks a 10% decline so far this week. As the token faces rising selling pressure, bearish sentiment is taking hold, with more short positions building in the market. The 50-day EMA now serves as a critical short-term resistance level, marking a crucial turning point in HYPE’s price action.

Data from CoinGlass reveals a sharp decrease in futures Open Interest (OI), dropping by 2% over the past 24 hours to $1.34 billion. This decline reflects a drop in retail demand as traders either close out their positions or reduce leverage. This is supported by the fact that long liquidations have outpaced short liquidations by a significant margin, with long positions losing $3.07 million compared to just $228,950 in short liquidations. The shift in liquidation dynamics has brought the long-to-short ratio down to 0.9037, indicating more short positions are being opened.

Bearish Outlook Grows as HYPE Breaks Below 50-Day EMA

As of Wednesday, HYPE’s price has slipped below its 50-day EMA, signaling a worsening technical outlook. A daily close beneath this level would signal further downside potential, with the next support levels at $23.58 and $20.82, which align with previous lows. The decline also places the 50-day EMA well below the 200-day EMA at $32.75, strengthening the bearish outlook in the short term.

Source: TradingView

The Moving Average Convergence Divergence (MACD) indicator has displayed a bearish crossover, and its negative histogram is widening, suggesting increased selling pressure. Meanwhile, the Relative Strength Index (RSI) sits at 48, below the midline, showing that HYPE is in a declining phase after recently being overbought. This signals that the token may have further room to fall before reaching an oversold condition.

Potential for Rebound Above 50-Day EMA

Despite the negative technical indicators, HYPE could see a reversal if it manages to secure a daily close above the 50-day EMA at $28.85. Such a move would relieve some of the immediate selling pressure and could set the stage for a rebound toward the 200-day EMA at $32.75.