The Hyperliquid token has fallen to a critical support level as trading volume on its decentralized perpetual trading platform has decreased.
Hyperliquid (HYPE) reached a low of $12.10, marking its lowest point since March 13. Its market capitalization has seen a drop from over $9.7 billion in December to just $4.43 billion now.
Data indicates that trading volume for cryptocurrencies on its platform fell again in March. The network recorded over $159 billion in volume, down from $187 billion in February and $197 billion in January.
Hyperliquid has achieved a cumulative volume of $1.16 trillion, asserting its position as the largest perpetual futures exchange in the sector, while its closest rival, Jupiter (JUP), has processed $268 billion in cumulative volume.
Furthermore, the total volume of assets traded across all decentralized perpetual futures platforms also declined in March, handling over $275 billion, down from $367 billion in January.
A similar pattern was observed in the spot market, where all decentralized exchanges managed $243 billion, significantly lower than the $564 billion recorded in January.
This downturn occurred as Bitcoin (BTC) and many altcoins lost momentum and began to fall. Historically, trading volumes on both centralized and decentralized exchanges tend to decrease during price declines in cryptocurrencies.
The price of HYPE also dropped amidst scrutiny over its management of Jelly, a newly launched meme coin. A trader executed two long positions on JELLY valued at around $4.1 million, and subsequently placed a corresponding short position worth the same amount.
These transactions drove JELLY’s price up by 400%, resulting in substantial losses for the Hyperliquidity Provider Vault. Consequently, Hyperliquid delisted the token, which prompted backlash from the community. The platform has since committed to compensating those impacted.
Technical Analysis of HYPE Price
The four-hour chart shows HYPE declined and reached a low of $12.11 on Monday. This level is significant as it aligns with the lowest swing seen on March 13, creating a double-bottom pattern with a neckline at $17.26, which represents its peak on March 24. A double bottom is often interpreted as a bullish reversal signal.
The MACD lines have formed a bullish crossover, while the BBTrend indicator has dropped to minus 25.13, which measures the distance between the outer lines of the Bollinger Bands indicator.
Consequently, the price of Hyperliquid is expected to experience a rebound, potentially reaching the resistance level at $17.26, about 31% higher than the current price. A fall below the double-bottom level may suggest further downside potential.