HYPE Token Nears $17.15 Resistance After 30% Recovery

HYPE, the native token of the Hyperliquid platform, has shown signs of recovery and is poised to challenge the $17.15 resistance level. The token's recent performance has been marked by a bullish structure on both the 1-day and lower timeframes, with a breakout above the descending channel erasing all losses incurred after March 24. The token's approach to the $17.15 resistance, which marked the swing high before the descending channel, suggests that a move beyond this level could signal another leg higher for Hyperliquid token prices.

However, the liquidation map indicates that short-term volatility is possible, with short liquidations being denser and closer than long liquidations. The $17, $17.3, and $17.45 levels are short-term targets due to high leverage liquidations clustered in these areas. Traders should be cautious of a false breakout past $17.15, driven by short liquidations, as it could reverse quickly. A retest of the $17 zone as a demand level could present a long opportunity for traders.

The Total Value Locked (TVL) on the Hyperliquid platform has shrunk from $636 million in the first week of March to $230 million a month later. One of the drivers of this exodus of capital was the way the Hyperliquid platform handled the JELLY saga. The platform saved its Hyperliquid Provider vault and wiped out its negative PNL that came as a result of the manipulation of JELLY and a trader’s long liquidation that Hyperliquid inherited. In the process, the legality of their course of action and the decentralization of Hyperliquid were questioned.

The trading volume of the platform remained fine and was under no immediate threat. This also meant the demand for HYPE was healthy. The token’s breakout above the descending channel a week ago has erased all the losses the token made after the 24th of March. It was approaching the $17.15 resistance that marked the swing high before the descending channel. On the 12-hour chart, HYPE has had a bullish structure since climbing above the lower high at $12.

Therefore, the 1-day and lower timeframes have a bullish structure, and a move beyond $17.15 would signal another leg higher for Hyperliquid token prices. This outcome appeared likely if Bitcoin [BTC] held its nerve. The A/D of HYPE made a new high, rising beyond the March highs. The RSI was also above 60 to signal strong upward momentum.

Monitoring BTC’s movement will be crucial to understanding market-wide sentiment and confirming potential price direction. The platform's handling of the JELLY saga and the subsequent questions about its legality and decentralization could impact investor confidence and the token's price movement. Traders should remain vigilant and consider the potential for short-term volatility as HYPE approaches the $17.15 resistance level.