Can persistent selling pressure drive Hyperliquid lower?

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Hyperliquid slides 7.54% to $55.66 today

Highlights

Hyperliquid burned 20,640 HYPE tokens, removing $1.2 million in supply, reinforcing its deflationary strategy amid persistent selling pressure.
Institutional staking now secures over $205 million in HYPE, with validator participation expanding to 27, further reducing liquid supply.
HYPE/USD faces strong bearish momentum, with pronounced downside risk and an expected consolidation range of $52.87 to $56.89 over the next few days.

Large token burn and institutional staking offset by persistent selling pressure

Hyperliquid conducted a burn of 20,640 HYPE tokens totaling $1.2 million in platform revenue, reducing circulating supply as part of its ongoing deflationary approach, according to Pluang. Recent large-scale staking of over $205 million worth of HYPE by institutional participants further locked up supply, while validator participation expanded to 27 with the foundation and other operators collectively managing all staked tokens, as reported by Crypto. Additional actions included the May 2026 introduction of outcome contracts through the HIP-4 protocol upgrade and continued engagement in U.S. regulatory discussions, although these developments have been accompanied by persistent selling pressure.

Pronounced bearish momentum as resistance levels confine price action

On the hourly chart, HYPE is trading below the MA-20 at $57.36 and MA-50 at $58.5, both indicating intraday and short-term resistance levels. The daily MA-200 at $45.02 acts as the principal support on a longer timeline, while the Ichimoku Kijun at $57.99 stands as immediate resistance and could hinder potential rebounds. Indicators show pronounced bearish momentum, with RSI at 28.21 firmly in oversold territory. Stochastic RSI points to a Strong Sell, and CCI remains on Sell, while MACD, ADX, and Bull/Bear Power all confirm strong dominance by sellers, with no bullish divergence present.

Limited rebound prospects as downside risk remains elevated short term

Over the next 2 to 3 trading days, HYPE is expected to consolidate within a volatility band between $52.87 and $56.89. The likelihood of an upward breakout is currently very low, while continued downside momentum holds a high probability. Short-term stabilization within this range remains the baseline scenario. A break above $57.99 would be needed to trigger a bullish reversal, while renewed selling below $52.87 would suggest further declines.

Viktoras Karapetjanc, Traders Union expert, sees solid fundamental progress for Hyperliquid despite the recent price weakness. He notes institutional staking and deflationary token burns as positive macro signals. Ongoing product launches and regulatory involvement support long-term adoption. However, technicals point to continued selling for now. "If supply constraints persist and sentiment stabilizes, HYPE could stage a strong rebound once the broader market turns."

Earlier, analysts noted that Hyperliquid faced persistent selling pressure even as institutional inflows and ecosystem developments attempted to stabilize price action. The addition of a significant token burn and further institutional staking underscores reinforced supply constraints, but continued dominance by sellers means any near-term reversal hinges on a sustained move above the $57.99 resistance level.

Source of Data: HYPE Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.