Hyperliquid (HYPE) finds itself at a pivotal juncture, with its price action attracting considerable attention amidst recent market volatility. Despite experiencing sharp drops, the cryptocurrency has shown resilience, stabilizing around a critical price zone that previously catalyzed significant upward movements. Investors and traders are closely watching how key support levels, coupled with the project's robust buyback program, might dictate its future trajectory.
Navigating Critical Price Levels
HYPE's price has recently settled in the $30 to $35 range, a zone historically known for sparking bullish rallies, including two previous new highs. This stabilization suggests a potential end to the recent correction, which saw prices dip following flash crashes on two consecutive Fridays. However, technical indicators present a mixed picture: HYPE has broken a key trendline, forming lower highs and lows, indicative of a bearish structure confirmed by negative On Balance Volume (OBV) and Chaikin Money Flow (CMF). Despite these bearish signals, the ability to hold the $30-$35 support is a crucial factor for a potential reversal.
The Power of Hyperliquid's Buyback Program
A significant force at play is Hyperliquid's aggressive buyback mechanism. According to Tokenomist data, the treasury has accumulated over $522 million worth of HYPE tokens since launch, representing more than 5.6% of the circulating supply. The most recent acquisition added 4,000 HYPE for $140,000, continuing a consistent accumulation trend. This strategic reduction of circulating supply, particularly during broader market corrections, aims to instill confidence in traders and has historically correlated with price appreciation, making it a strong hint of a looming price reversal.
Reversal Prospects Amidst Derivative Activity
While the ongoing buybacks suggest a potential reversal, the immediate market structure remains weak. Interestingly, the derivative market shows significant activity, with large whale orders dominating futures trading, especially on Binance. Leveraged positions are concentrated between $34 and $36, with cumulative longs outweighing shorts, hinting at a possible upward move. However, the risk of further decline persists due to short positions near the accumulation zone. The current price level is therefore critical for HYPE; maintaining it could trigger a rebound, whereas a breakdown might lead to further losses, making it a defining moment for the asset.
