Reason behind Hyperliquid’s fall explained – Where can HYPE go from here?

Key takeaways

Why is HYPE price falling?

Whale sell-offs, profit-taking, and fears of a massive $11.9B token unlock have triggered heavy selling.

What could decide HYPE’s next move?

HYPE needs stronger buying volumes, or it risks further dips before November’s unlock.

Hyperliquid [HYPE] has stumbled, shedding value faster than many expected. But what triggered the drop, and what’s next?

Signs of relief after big losses

At the time of writing, HYPE’s price closed at $42.29 after bouncing 4.7% in the last session. But the recovery came after a steep week-long sell-off that saw the coin fall by nearly 25% in the last week.

Source: TradingView

The RSI sat at 37.8, still in bearish territory, showing the token was close to oversold levels at press time. OBV also trended lower, proving weak buying pressure despite the rebound.

The latest green candle indicated a short-term pause in selling, but unless volumes pick up, this move could be more of a breather than a full reversal.

But why?

The decline in HYPE is also tied to investor behavior and looming supply risks.

Many holders rushed to book profits after the strong rally, but fears over a massive $11.9 billion token unlock in November have added extra pressure.

The concern is that so many new tokens entering circulation could dilute value, driving early whales to sell in advance.

Arthur Hayes selling his HYPE stash (reportedly for a Ferrari, no less) a month after his 126x gains prediction seems to have amplified the panic, causing more whale sell-offs.

That includes one address offloading nearly $9 million in HYPE.

Source: X

At the same time, rising competition from Aster [ASTER] is stealing the spotlight, with its trading volume recently surpassing Hyperliquid and denting HYPE’s dominance in the perpetual DEX space.

What’s next for HYPE?

At press time, Open Interest held steady near $1.88 billion, so traders were not aggressively exiting positions despite the pullback.

The Funding Rate stayed positive at 0.0229, so long positions still slightly outweighed shorts.

Source: Coinalyze

While this is optimistic, the broader downtrend remains intact. For a meaningful reversal, HYPE would need stronger buying volumes to push it back above the $45-$47 range.

Until then, sideways action or further dips remain likely, especially with November’s token unlock event looming.