Hyperliquid loses its key trendline – THESE 3 factors are driving sell-off
Hyperliquid's weekly revenue has dropped by 3x to $7M, affecting the pace of buybacks
Hyperliquid [HYPE] has extended its losses to 22% from the July peak of $73, effectively breaking a key trendline as analysts turn defensive. According to renowned crypto analyst Michael Van de Poppe, it was time to be “passive” on the altcoin.
$HYPE has lost the uptrend unfortunately, which means that I’m going to be more passive on a potential trade. Last time this occurred, price fell from €50 to €15.
In other words, Poppe preferred more of a slow scaling if the pullback extends. Think of it as a daily average cost (DCA-ing) strategy where one allocates small amounts periodically to the altcoin.
Another analyst and trader, Dylan Loomer, popularly known as Trader Mayne on X, echoed a similar stance and projected a potential 38% pullback to the monthly demand zone near $35.
No idea if we get down to the monthly demand zone, but if we do, I think buying HYPE as low as you possibly can is a good idea. $35 would be a gift, but I’ll start scaling in earlier than that.
In the first half of 2026, HYPE outperformed the market and became traders’ darling, partly fueled by the early West Asia crisis. So, what happened to its bullish catalysts in H2 2026?
3 factors driving HYPE selling pressure
First, the institutional demand from U.S Spot HYPE that fueled the explosive rally to a new all-time high in June has faded in July.
Since mid-July, the products have remained negative for the longest time since their debut. They’ve been bleeding an average of $1M per day (~20K HYPE) since the 10th of July.
Venture firms like a16z and Multicoin Capital (who unstaked a $120M HYPE this week) further intensified institutional sell-offs.
Are weaker buybacks hurting HYPE?
Besides, trading activity has slowed down since June, cutting revenue by 3x from a weekly average of $21M to $7M. Subsequently, this has impacted the pace of HYPE buybacks by 3x, from 318K HYPE in early June to 108K tokens in late July.
This was about 20K HYPE on a daily average, meaning the buyback program should be enough to absorb the ETF sell pressure.
It’s likely that HYPE is currently reacting to the Multicoin Capital sell-off headline story and broader market sentiment.
In fact, smart money’s net positioning was negative, with over $150M betting against its recovery.
Overall, traders are actively shorting the Hyperliquid [HYPE] amid declining buybacks and ETF and VC firms’ sell-off. But some analysts believe deeper corrections could offer new discounted buying opportunities.
Final Summary
- HYPE has dropped 22% from $73 to $57 as analysts warn that the pullback could deepen
- U.S spot HYPE ETF sell-offs have hit $1M in weekly average, while buybacks decreased by 3x, further weighing on the altcoin’s value.
