HYPE Token Tests January Lows Amidst Crypto Market Slump
1min read Hyperliquid's HYPE token has been defending its January lows, but the question remains whether this support will hold or if a breakdown is imminent. The total crypto market cap has fallen by 13% since January 9, with the altcoin market cap (excluding Ethereum) down by 17.5%. In comparison, HYPE has declined by 7.2% from its opening price on that day.
The 1-day price chart shows that HYPE has tested the January lows at $18.5 several times recently, with the bulls successfully defending this level. However, the On-Balance Volume (OBV) indicator has fallen sharply, suggesting that selling pressure in the spot market is increasing. If buying volume does not pick up significantly, HYPE may soon fall below the $18.5 support level.
Data from Dune Analytics reveals that while the number of new users on the Hyperliquid platform has not continued to decline since January, daily trading volume has maintained a flat trend. This indicates that the platform continues to see traffic despite challenging market conditions and bearish sentiments. Additionally, fees generated have risen compared to late December, suggesting increased volume on the platform.
However, the Open Interest has begun to trend lower over the last ten days, hinting at a fall in speculative activity and pointing towards sidelined traders and prevalent bearishness. A HYPE price drop below $18.5 may be possible, especially if Bitcoin falls below the $80k psychological level again. If market sentiment improves in the coming days, HYPE bulls might manage to defend the $19 support zone.
