Strong fundamentals drive HYPE gains
Hyperliquid’s HYPE token has been performing surprisingly well while most of the crypto market struggles. I think what’s interesting here is that the token managed to climb higher even as major assets faced heavy selling pressure. The momentum seems to be coming from a few different sources working together.
The Base Liquidity Pool testnet launch on Hypercore has definitely added some energy to the ecosystem. It’s not just about being a fast exchange anymore – they’re positioning themselves as a hub for tokenized equities like Nvidia and Tesla. That’s attracting new users at a time when other platforms are seeing activity drop off.
Buyback program creates supply pressure
Another big factor is the aggressive buyback program. They’ve already removed over 28 million HYPE tokens from circulation through buybacks worth more than $1.3 billion. When you take that much supply off the market, it naturally creates upward pressure on the price.
What I find interesting is how staking deposits have jumped nearly 60% in just a month. That’s significant because it means long-term holders are locking up their tokens, which reduces selling pressure. More staking usually means people believe in the project’s future.
Hyperliquid’s market share in perpetual futures has grown to over 6% now, which puts them in the same conversation as centralized giants like Binance and OKX. That expansion brings in more fees, which fuels more buybacks, creating this sort of positive feedback loop for the token’s fundamentals.
Technical concerns emerge
But here’s where it gets tricky. Despite all these positive developments, the charts are showing some warning signs. There’s a head-and-shoulders pattern forming on the daily chart since June, which technical analysts often view as a bearish signal.
The neckline of this pattern sits around $35.5, and that level has been acting as important support. If the price breaks below that, we could see HYPE drop toward the $30 area. That’s a meaningful decline from current levels.
Another concern is the approaching death cross, where the 50-day moving average crosses below the 200-day moving average. This typically signals a shift toward a deeper downtrend, especially during uncertain market conditions.
Mixed signals create uncertainty
Still, HYPE has managed to hold above $40, which suggests demand remains decent. A clean break above $46 would likely invalidate the bearish technical setup. It’s one of those situations where the fundamentals and technicals are telling different stories.
Perhaps what we’re seeing is a battle between strong project development and broader market sentiment. The buybacks and ecosystem growth provide solid support, but the technical patterns suggest caution might be warranted.
I think investors need to watch both the fundamental developments and the key technical levels. The $35.5 support and $46 resistance levels will probably be important in determining the next major move.
