Hyperliquid (HYPE) has been struggling to gain bullish momentum in the early part of the year, despite occasional upticks. The resistance levels have proved to be a tough barrier to break through for HYPE.
However, there is a sense of optimism among enthusiasts, especially as HYPE seems to be moving away from Bitcoin's overall market trends. This divergence positions HYPE favorably for potential future growth and price gains.
There is a glimmer of hope for a breakout in HYPE as the funding rate remains positive, reflecting the sustained optimism of traders. Many traders are holding on to long contracts with hopes of a price resurgence. This positive sentiment is crucial in fueling a possible rally and shielding the token from significant downturns in the short term.
The prevailing optimism indicates that traders believe in HYPE's capacity for upward movement, despite its recent underperformance. The continuous support for long positions indicates a bet on a rebound. If this optimistic sentiment persists, it could help HYPE establish a solid price base and pave the way for further advancement.
HYPE's correlation with Bitcoin has been negative, adding complexity to its market dynamics. While Bitcoin is striving to stay above the $100,000 mark, presenting a bullish outlook, HYPE's detached stance from Bitcoin could hinder its ability to leverage any potential rally, especially amidst the decline in correlation.
This diminishing correlation may leave HYPE more exposed to corrections, as its price might not respond as strongly to Bitcoin's movements. A scenario where Bitcoin maintains its strength while HYPE struggles to align could impede its progress in overcoming crucial resistance levels.
Looking ahead, HYPE seems poised for a potential breakout as it oscillates within a range of $19 to $27 since the start of the year. A breakthrough above $27 could signal the initiation of a rally, albeit the lack of momentum has held back significant gains.
If HYPE successfully breaches the $27 level and maintains support above it, a push towards $32 could be on the horizon. This move would signify progress towards surpassing its all-time high (ATH) of $42, requiring a 63% increase to reach that pinnacle. Should $32 evolve into a strong support level, a new ATH could well be on the cards.
Conversely, failure to breach $27 and a drop below $23 could see HYPE retracing back to $19, prolonging its consolidation phase. This outcome would nullify the bullish stance, suggesting that HYPE might need additional time to regroup and gather momentum for a more substantial upward rally.