Hyperliquid (HYPE) Crashes Below $25: Technicals Signal Deeper Correction Ahead

Hyperliquid's HYPE token just sliced through the $25 support level—and the charts are flashing red.

Technical Breakdown: The Fallout

Key moving averages have flipped from support to resistance. That breach below $25 wasn't a gentle dip; it was a decisive breakdown on heavy volume. Classic chart patterns suggest this isn't a buying opportunity—it's a warning sign. The next major support zone sits significantly lower, and momentum indicators aren't showing any signs of a bullish divergence yet.

Market Sentiment Turns Sour

Remember the euphoria from a few weeks ago? Gone. The fear-and-greed meter is tilting hard. Social sentiment data shows a rapid shift from 'HODL' to 'sell the bounce.' Leveraged long positions are getting liquidated, adding more fuel to the downward spiral. It's the crypto market's version of a margin call—ruthless and efficient.

What's Next for HYPE?

Traders are now watching for a consolidation phase. Any rally back toward the $25 level will likely face a wall of sellers looking to exit. The path of least resistance remains down until proven otherwise. For the bulls, patience isn't just a virtue—it's a survival strategy. Sometimes the best trade is no trade at all, a concept that seems foreign to portfolio managers chasing last quarter's performance.

In crypto, gravity always wins—eventually. The only question is how far the drop goes before the next narrative takes flight.

HYPE Breaks Key Fibonacci Support Levels

From the technical analysis, HYPE has violated significant Fibonacci support levels at both 0.382 and 0.5, which acted as levels that prevented the price from reversing. It is currently above the level at 0.236, which is considered the last level before a full retracement.

Source: Tradingview

A close below this level could push HYPE into the low $20s or even nullify its recent gains. Looking on the positive side, it is difficult for the price to MOVE upwards due to resistance at levels of $35-$45, so a pullback could just be a correction, but not a full recovery.

Momentum indicators also validate the bearish analysis. The RSI is about 37, indicating a weak momentum and a lack of any FORM of rebound. MACD is negative, with both lines below zero and increasing, indicating acceleration and not slowing down.

Source: Tradingview

The BBTrend values about 40.56, indicating an increasing degree of volatility during the downturn, which is associated with distribution and not consolidation.

Hyperliquid Short Strategy Delivers 265% Gain

Analyst crypto Patel discussed on X about a shorting trade on HYPE. It dropped in price from $50 to $22 using 5x leverage and gained 265% profit.

Patel further explained that the current situation was the right time to accumulate positions in a slow process for long-term benefits and not to buy positions in large volumes. However, if it drops further to the range of $20-$15, one can purchase through dollar-cost averaging.

Source: X

However, further losses could also occur, according to him, since “the market might move to lower levels before stabilizing. Patel’s plan involves ensuring that gains from shorting are well-balanced while preparing for potential gains in the future.

To put it bluntly, traders with short sale gains can invest again, provided that the price is within the accumulation range.