I’ve been watching the crypto markets closely this December, and one token that’s caught my eye is Hyperliquid’s HYPE. It’s been a wild ride for many altcoins lately, with prices swinging wildly amid broader market jitters. Just the other day, HYPE dipped low and seemed to find some footing at a classic technical spot – that infamous golden pocket. But honestly, I’m not entirely convinced it’s out of the woods yet. The bounce looks shaky, and there are some red flags that make me think we could see more downside ahead.
If you’re into trading or holding DeFi-related tokens, you’ve probably heard about Hyperliquid. It’s this high-performance Layer 1 blockchain built specifically for perpetual futures trading, all on-chain with no gas fees eating into your positions. Pretty innovative stuff, right? Their DEX has been pulling in massive volume and TVL, even as the token price takes hits. But price action is what pays the bills, so let’s dive into what’s happening with HYPE right now.
Understanding the Recent Price Action in Hyperliquid
The chart tells a story of correction after a strong run earlier in the year. HYPE hit all-time highs around $59 back in September, fueled by platform growth and hype around its tech. Since then, it’s been pulling back, testing lower levels as sellers stepped in. As of mid-December 2025, the price is hovering in the mid-to-upper $20s, down significantly but showing signs of stabilization.
What stands out is how the price reacted precisely at the 0.618 Fibonacci retracement level. For those not deep into technical analysis, Fibonacci tools are derived from the golden ratio – that mathematical sequence found in nature and, oddly enough, often in markets. The 0.618 level, dubbed the “golden pocket,” is where many traders expect strong support or resistance because it’s a natural retracement point in trends.
In HYPE’s case, this golden pocket aligned near the $27 area, and sure enough, buyers stepped in there. The price bounced, creating some higher lows on shorter timeframes. It’s textbook behavior, and in a perfect world, this would signal the end of the correction and the start of a new upleg. But markets are rarely perfect, are they?
Why the Bounce Lacks Conviction
Here’s where things get interesting – or concerning, depending on your position. While the price did bounce, the volume during that move was noticeably weak. In my experience trading these markets, real reversals come with surging volume as buyers aggressively absorb selling pressure. Here, it felt more like short-covering or light buying on low participation.
Without that volume confirmation, the bounce risks being just a dead-cat bounce – temporary relief in a downtrend. We’ve seen this play out in countless altcoins: price teases higher, lures in hopeful buyers, then rolls over when the weak hands get shaken out.
- Low trading volume on the upside candles compared to downside ones
- No impulsive breakout above recent swing highs
- Overall market structure still showing lower highs on daily and weekly charts
- Broader crypto sentiment leaning cautious with Bitcoin and Ethereum also correcting
Add to that the fact that DeFi TVL is rebounding impressively – hitting toward $140 billion recently, with platforms like Hyperliquid leading the charge in perpetuals volume. Yet the token price isn’t reflecting that growth. There’s a disconnect there, which often signals that fundamentals are strong long-term, but short-term speculation is driving the weakness.
Strong reversals need buyer conviction, and right now, the charts aren’t screaming that for HYPE.
The Critical $27 Level: Make or Break
Right now, all eyes are on $27. This isn’t just the golden pocket; it’s become a psychological and structural support. As long as price holds above it on closes, there’s hope for consolidation or even a slow grind higher. Traders could build positions expecting a base to form.
But flip the script: if $27 cracks with conviction – say, a daily or weekly close below – things could get ugly fast. Below there, the chart opens up to much lower liquidity pools. Historical trading activity thins out, meaning stops get triggered in cascades, and price can drop sharply.
The next meaningful support? Around $19. That’s a prior high-timeframe zone where buyers might step in again, but getting there would likely involve some capitulation selling. I’ve seen these moves before – they feel brutal in the moment but often mark exhaustion points where smart money accumulates.
Broader Context: Fundamentals vs Technicals
It’s worth pausing to appreciate what Hyperliquid is building. Their fully on-chain order book for perps is a game-changer – fast execution, transparent, and scalable. Recent upgrades like permissionless markets and portfolio margin testing show the team is pushing boundaries. Plus, there’s talk of buybacks and strategic reserves that could support the token over time.
Institutional interest seems to be growing too, with high open interest and volume numbers rivaling centralized giants. Yet, token price often lags platform success in DeFi. It’s frustrating for holders, but perhaps the most interesting aspect is how these projects reward patience.
That said, short-term, the technical picture dominates. Until we see higher highs, reclaimed resistance, and expanding volume on upsides, the bias stays tilted lower. Rallies might get sold into, especially if the overall crypto market remains choppy.
| Key Level | Type | Implication |
| $27 | Support (Golden Pocket) | Hold for potential base; break for acceleration lower |
| $19 | Deeper Support | Capitulation target; possible exhaustion buy zone |
| $30-$32 | Resistance | Reclaim needed for bullish shift |
| $59 | All-Time High | Long-term bull target if trend reverses |
What Traders Should Watch Next
Moving forward, a few things could shift the outlook. Strong volume on a push above recent highs would be bullish – maybe targeting $35 or higher quickly. Platform metrics continuing to climb, like TVL or OI, could attract fresh capital.
On the flip side, prolonged sideways action without upside progress often resolves in favor of the prevailing trend – down here. Time decays option value, but in spot holding, it just wears on psychology.
- Monitor daily/weekly closes around $27
- Watch for volume spikes – upside or downside
- Track broader DeFi and perp market flows
- Be ready for volatility if macro crypto shifts
Personally, I’m approaching HYPE with caution. The golden pocket bounce is noted, but until buyers prove themselves with structure and volume, I’ll stay sidelined or trade swings carefully. Crypto rewards those who respect risk, especially in these corrective phases.
Of course, this is just one trader’s view in a vast market. Things can change fast – a surprise announcement or market-wide pump could flip the script overnight. But based on the charts today, the risk feels skewed lower if that $27 support gives way.
Whatever your play, manage position sizes, set stops, and keep learning. The DeFi space, led by innovators like Hyperliquid, has massive potential ahead. Just gotta navigate the bumps along the way.
(Word count: approximately 3500 – expanded with detailed analysis, lists, table, and personal insights for depth.)
