After rallying more than 3x since the February low of $20 to $75, Hyperliquid [HYPE] has seen rising profit-taking. It has now fallen by 27% and traded at $55.7 as more whales booked profit.
Unsurprisingly, the recent sell-off also coincided with Bitcoin’s extended losses. This suggested that the dump was a broader risk-off move and not specific to the Hyperliquid ecosystem.
That said, the HYPE pullback retested the golden ratio or the 50%-61.8% Fibonacci level zone, which is typically associated with potential rebounds if it holds as support. This coincided with the $48-$55 price zone when measured from the February lows and June highs.
If defended, the zone could be of key interest to the bulls, especially swing traders or long-term holders. A sustained dip below $48 would invalidate the bullish outlook.
In fact, such a bearish move would embolden short sellers to eye $40 and $36 (200-day MA, blue) levels.
Institutional HYPE demand slows down
The pullback also coincided with a broader cooldown in spot ETF inflows. Last Friday, the products saw their first daily net outflow, worth about $3M. On Tuesday, there was zero flow, according to Soso Value data.
This contrasted with the strong inflows seen in May, which drove HYPE to new all-time highs. Interestingly, a similar trend was observed across whale holders and smart money players.
According to the on-chain analytics platform Nansen, whales trimmed their exposure to HYPE by 58%. Similarly, exchange selling pressure jumped 200% over the past week.
Collectively, this meant whales booked profits in the past few days and likely contributed to the recent selling pressure.
But another positive cue was smart money investors, whose activity was up 8% over the same period. This implied that some sophisticated players were taking advantage of the discounted window to add more exposure to HYPE.
As such, if Bitcoin defends $60K and fronts a sustained recovery, HYPE could follow suit. In fact, the altcoin could trigger a much stronger recovery because of catalysts like the Coinbase deal, which will soon accelerate HYPE buybacks from the USDC treasury yield.
Final Summary
- HYPE has dropped 27% from $75 to $55, which coincided with a key golden area that attracts new demand if BTC does not extend losses.
- The pullback was accelerated by whales’ sell-off, but some smart money investors were buying the dip.