Hyperliquid’s native token, HYPE ($40.32), is showing signs of weakness following recent market volatility. After several failed recovery attempts, the altcoin is struggling to maintain its footing above crucial support levels. 

While short-term traders anticipate a potential rebound, technical indicators suggest long traders should proceed cautiously.

Hyperliquid Traders Could Face Losses

The liquidation map reveals that HYPE long traders could face up to $24.40 million in potential liquidations if the token drops to its month-long critical support at $35.3. This would represent a substantial risk, as it could trigger widespread position closures among leveraged traders.

What makes this development more concerning is that this level has already been tested twice in the past month. A third test could undermine market confidence and discourage new long positions, leaving HYPE vulnerable to increased volatility and downward price pressure.

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HYPE Liquidation Map. Source; Coinglass

The Moving Average Convergence Divergence (MACD) indicator is flashing early warning signs of intensifying bearish momentum.

A bearish crossover recently occurred, suggesting a possible continuation of selling pressure. Although the current downturn is not yet severe, a decline in market confidence could accelerate losses.

If broader crypto market sentiment worsens, HYPE could face difficulty maintaining its current trading range. A deepening bearish trend may prolong recovery efforts, pushing traders to exit before conditions improve. On the other hand, stabilization in Bitcoin and altcoin markets could ease selling pressure on HYPE.

HYPE MACD. Source: TradingView

HYPE Price Could Slip To Support

HYPE is trading at $39.9 at the time of writing, consolidating within a narrow range between $42.4 and $38.4. The chances of an upward breakout appear limited unless market sentiment improves considerably and buyers return.

If bearish conditions persist, HYPE could lose its $38.4 support, testing the $35.3 level again. A breakdown below this threshold could trigger millions in long liquidations, amplifying the decline and delaying any recovery attempts.

HYPE Price Analysis. Source: TradingView

Conversely, if positive momentum builds and investor support strengthens, HYPE could attempt to breach the $42.2 resistance level.

Successfully flipping this barrier into support could propel the altcoin toward $47.1, invalidating the bearish outlook and restoring optimism among traders.

The post Why HYPE Long Traders Should Worry About $24 Million Liquidations appeared first on BeInCrypto.