Hyperliquid shares fell again on Monday, extending losses of more than 2% as weakness spread across the wider cryptocurrency market weighed on risk appetite. The decline comes even as data indicates continued institutional accumulation through Hyperliquid exchange-traded products, while derivatives signals point to growing caution among more active, shorter-term traders.
Investors are now looking closely at key technical levels and the direction of derivatives positioning for clues on whether the selloff stabilizes or accelerates.
Key takeaways
- Price move: Hyperliquid extended its slide, dropping more than 2% on Monday.
- Catalyst: A broad risk-off tone in crypto coincided with weakening derivatives metrics, including declining futures open interest and long-side liquidations.
- Key implication: A break below the 50-day EMA could increase the odds of further downside toward the next identified support level.
- Counterpoint: Hyperliquid-focused ETFs recorded net inflows last week, suggesting institutional demand is still supportive.
What drove the move
The latest drop in Hyperliquid came as geopolitical tensions involving the United States and Iran continued to foster a risk-off environment across markets. In that setting, investors often reduce exposure to higher-volatility assets, and altcoins such as Hyperliquid tend to trade more defensively when sentiment deteriorates.
Derivatives data emphasized that traders were becoming less willing to hold leveraged positions. According to CoinGlass, Hyperliquid futures open interest (OI) fell by more than 1% over the prior 24 hours to about $2.7 billion. Lower open interest alongside falling prices typically indicates that market participants are closing positions rather than initiating fresh bullish bets.
CoinGlass data also showed total liquidations of $2.8 million during the same period, with roughly $2.3 million attributed to long positions. The imbalance suggested that upside traders were getting forced out, reinforcing the downward pressure.
Further confirmation of cautious positioning came from a sharp decline in Hyperliquid’s funding rate to 0.0275%, a level consistent with a market increasingly leaning toward short exposure in the near term.
Market reaction and what it signals
While the derivatives picture leaned bearish for near-term price action, institutional flows appeared steadier. According to CoinGlass, Hyperliquid-focused ETFs received $10.36 million in net inflows last week, extending a streak of nine consecutive weeks of positive flows.
That mix—resilient ETF demand alongside weakening futures positioning—could translate into a market that remains supported by longer-horizon buyers but remains vulnerable to sharp drops if leveraged traders continue to reduce exposure. In other words, institutions may be accumulating even as retail and short-term traders exit, leaving price more sensitive to any additional negative catalysts.
Technical levels investors are watching
On the charts, Hyperliquid was trading around $65 after breaking below a previously supporting ascending trendline that had held near $68.50. Attention has shifted to the 50-day exponential moving average (EMA) at $63.13, which is now viewed as the next meaningful support.
The technical framework suggests downside risk if momentum weakens further. A decisive daily close below the 50-day EMA could open the door to a move toward the next support level at $53.71.
Momentum indicators point to deteriorating conditions for buyers. The relative strength index (RSI) slipped to around 44, below the neutral 50 level, signaling weakening buying strength. Meanwhile, the moving average convergence divergence (MACD) has crossed below its signal line, and the negative histogram continues to expand—signals traders typically interpret as bearish momentum building.
From a rebound perspective, buyers would likely need to regain the broken trendline and push the price back toward the prior swing high at $75.58, which has turned into the primary resistance level.
Bigger picture: flows vs. leverage
Investors appear to be weighing two competing forces: strengthening or stabilizing institutional demand via ETFs against a derivatives market that is showing reduced leverage and forced selling on the long side. In the current risk-off backdrop, that tension can matter—ETF inflows may provide longer-term support, but price can still drift lower if leveraged participants keep exiting.
Geopolitical risk tied to U.S.-Iran tensions remains a key macro variable to monitor, as it can influence broader market sentiment toward risk assets, including cryptocurrencies.
Next, traders will likely focus on whether Hyperliquid can hold the 50-day EMA near $63.13 and whether the market can reverse the bearish momentum signaled by RSI and MACD. Continued ETF inflow data may offer longer-term confirmation of institutional appetite, while any renewed deterioration in futures metrics could point to additional downside toward $53.71.
