$22.5M in HYPE losses – Can Hyperliquid stop the downtrend?

After being rejected at $50 a month ago, Hyperliquid [HYPE] has continued to trade within a descending channel, reaching a low of $22. At press time, HYPE was priced at $23.2, up 1.24% on the daily chart but down 17.7% over the week.

This sustained downtrend has led to significant losses for HYPE traders, particularly in the futures market.

Hyperliquid whale sits on a $22.5M loss!

While HYPE struggled on its price charts, investors, especially whales, have dominated the futures market. Futures Average Order Size data from CryptoQuant showed Big Whale Orders for two consecutive months. 

A sustained period of such orders indicated increased participation, either taking shorts or long positions. 

According to Lookonchain, a whale opened a 10x long position on 207,497 HYPE, valued at $4.72 million, with a liquidation price set at $13.68.

Meanwhile, Onchain Lens reported another whale whose 5x long position has turned into losses, with a floating deficit of more than $22.5 million. Despite the mounting pressure, this whale continues to hold, with liquidation looming at $20.66.

Such behavior often reflects strong conviction and confidence in a potential market reversal, as whales endure short‑term pain in hopes of securing significant future gains.

Liquidation rate spikes

As observed above, whales have been aggressively betting for a price rebound. However, this is not an isolated case, as most participants have taken long positions.

According to CoinGlass data, Hyperliquid’s Long Short Ratio jumped to 1.03, at press time, where 50.81% accounted for longs while 49% accounted for short positions.

Therefore, most market participants are bullish and expect prices to jump again. Sadly, these sentiments have continued to lead to more liquidations of long positions.

In fact, between the 18th and 19th of December, more than $70 million worth of long positions were liquidated. Over the same period, only $0.54 million worth of short positions were liquidated.

Such market conditions indicate bullish leverage is being wiped out as the market fluctuates to the downside.

HYPE bears dominate the market

Despite whale demand for longs, bearish pressure has overwhelmed the market, leading to most of these longs being liquidated. As such, bullish leverage failed to boost the market, leaving it on the brink of further losses.

At the time of writing, Hyperliquid’s Relative Strength Index (RSI) sat within oversold territory at 29, indicating seller dominance.

Likewise, the altcoin sat below short-term Moving Averages (MA), MA9 and MA21, reflecting intense short-term bearish pressure.

Current market conditions point to strong downward momentum and a high probability of continued weakness. 

If this trend persists, HYPE could break below the $22 support and fall toward $20, potentially triggering a whale liquidation.

On the other hand, a bullish reversal requires a decisive close above the MA9 at $26 and the MA21 at $29. Only then could the market outlook shift in favor of buyers.

Final Thoughts

• Hyperliquid whale sits on a $22 million floating loss, as longs liquidation surge to $70 million.
• HYPE is under intense bearish pressure and could drop to $20 if bulls fail to flip MA9 and MA21.