Is the Uptrend Finally Over for Hyperliquid?

Hyperliquid has been in the news for most of the week following its recent massive run. It was one of the top gainers during the first three days, attaining levels not seen in more than a month.

The uptrend began on Monday when it recovered from the large plummet it had the previous day. It surged by over 12% and continued the uptrend the next day. However, the asset broke above its seven-day and fourteen-day highs at $28.3. In the end, it gained over 23% after reaching its highest level in the last four weeks.

The upward trend extended on Wednesday, but was not as significant as the previous ones. Nonetheless, HYPE attempted to reach December’s high but failed, as it was rejected at $35. It declined slightly as a result, but ended the session with gains of more than 11%.

The entire crypto market was also bullish during the first three days of the week. However, this is not the only trigger for Hyperliquid’s surge. For weeks now, precious metals have been on the rise, leaving crypto behind.

This week, investors decided to diversify their bags and trade these metals on Hyperliquid. As a result, demand for the token rose, driving prices higher.

In response to the uptrend, some traders began speculating on further increases that may extend into February. They also speculated that an all-time high would come next month.

However, HYPE had its first red candle of the session on Thursday, losing over 11%. The downtrend continues, with the asset down over 6% on Friday.

Is the Uptrend Over?

Hyperliquid is trading down by almost 17% in the last 48 hours. It is also edging closer to its second day of downtrend. Bullish speculation has since halted as traders take profits and hedge against the current decline.

The cause of the latest downturn is not far-fetched; it started when fears of the US government shutdown loomed. The initial jobless claim worsened the decline on Thursday, and now, the threat of tariffs on Canada.

However, there is more. Recall that one of the drivers of the uptrend was traders trading precious metals on Hyperliquid. These assets are also seeing significant selloffs at the time of writing. For example, Gold posted a doji after experiencing a sharp decline.

The metal is down by almost 7% on Friday, indicating that the talks about it have also declined. As a result, the volume on Hyperliquid receded.

Aside from fundamentals, the 1-day chart shows the asset was overbought on Wednesday, with the RSI surging above 70. As with the principle guiding the metric, large selloffs followed. Additionally, it broke above the bollinger bands on Tuesday but is currently trading below the upper band.

Will Hyperliquid Surge Again?

Given the reason for the latest run, the chances of HYPE surging again will depend on these precious metals: Gold and Silver. They may pique traders’ interest again, driving a massive surge in volume on Hyperliquid and boosting demand for the native token.

However, the chart suggests the asset will retrace further in the coming days. Following the drop below the upper band, the next price target may be the middle band at $25.

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