HYPE Shows Strong Buyer Control as Cascading Liquidations Wipe Out Short Positions

• HYPE’s rally to $40 shows strong bullish momentum fueled by rising open interest.
• Liquidation spikes near $42 confirm buyers’ control and wipe out overleveraged shorts.
• Technicals suggest strength, but RSI near 70 signals caution amid possible short-term cooling.

Hyperliquid (HYPE) is on the verge of a potential breakout, with BitMEX Co-Founder Arthur Hayes signaling a sharp move ahead as multiple on-chain and technical indicators align. After a powerful V-shaped recovery from its April lows near $8, HYPE has surged nearly fivefold to trade at $40.88, with the $40 mark now acting as a crucial pivot point for the token’s next move. 

Hayes noted that if HYPE can successfully hold the $40 level as new support, it could be positioned for a rapid climb in the coming sessions. His commentary comes as a confluence of bullish data, from soaring open interest to a recent short squeeze, suggests that market momentum is building.

Open Interest Soars to $1.8 Billion, Signaling High Conviction

The powerful price rally has been supported by a massive influx of capital into the HYPE derivatives market. According to data from Coinglass, open interest in HYPE futures has jumped from under $500 million in mid-April to nearly $1.8 billion as of June 10. 

Source: Coinglass . 

This synchronized rise suggests increasing confidence and growing participation from market players. Notably, open interest broke past key milestones at $600 million, $1.2 billion, and $1.5 billion over the past month. These surges align with HYPE’s price spikes, hinting at speculative buying and likely fundamental catalysts driving interest.

Source: Coinglass

Short Squeeze Above $40 Confirms Buyers Are in Control

Further evidence of bullish strength comes from liquidation data. Bybit’s liquidation heatmap showed a heavy concentration of short positions between the $36 and $40 levels. 

As the price rose beyond these bands, cascading liquidations were triggered. A spike to $42.449 accompanied by $295.09K in liquidations confirmed strong bullish pressure. Buyers are in control, wiping out overleveraged shorts and paving the way for another potential move upward.

Key Indicators Signal Continued Strength

HYPE/USD daily price chart, Source: TradingView

As of press time trading at $40.88 the technical outlook remains positive. The MACD line recently crossed above the signal line, though the histogram now shows only modest strength. This suggests bullish momentum is still present, but may be slowing slightly. 

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Meanwhile, the RSI stands at 69.99, teetering on overbought territory. While this doesn’t imply an immediate reversal, it does signal that short-term gains could cool.

Looking Ahead: Cautious Optimism Into Year-End

Despite the current rally, projections suggest a more modest outlook by December. Coincodex analysts expect HYPE to trade between $32.90 and $33.70, representing a 17.70% decline from current levels.

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However, should the breakout materialize and bullish pressure remain, these estimates could quickly become outdated.