Hyperliquid (HYPE) Drops Despite HyperEVM Launch: What’s Next?

Hyperliquid (HYPE) has dropped despite the launch of HyperEVM, a major update aimed at enhancing the platform’s decentralized finance (DeFi) capabilities. The integration of Ethereum Virtual Machine (EVM) support is expected to introduce smart contracts, but technical indicators suggest weak momentum and increased bearish pressure.

The HyperEVM launch marks a significant step for Hyperliquid, allowing for seamless transfers between native HYPE and HyperEVM assets. The upgrade also introduces a canonical WHYPE system contract, reinforcing DeFi activity on the platform. Despite this, traders remain cautious as HYPE struggles to gain bullish momentum.

Hyperliquid has established itself as one of the top-earning crypto platforms, generating millions in revenue over the past week. It has surpassed several well-known projects and is closing in on larger names in the industry. However, technical signals suggest that this financial success has not yet translated into upward price movement for HYPE.

Indicators point to fading bullish strength. The ADX has fallen sharply, signaling a lack of strong trend direction. A reading below a key threshold suggests that the market lacks conviction, and while positive momentum still exists, it is not dominant. Short-term EMA lines are trending downward, suggesting the possibility of a bearish crossover. If this continues, selling pressure could increase further.

Meanwhile, the RSI has dropped significantly in recent days, reflecting a rapid loss of bullish momentum. Although still above oversold levels, the downward trend suggests that sellers are in control. If the RSI continues to decline, HYPE could enter oversold territory, possibly triggering a rebound if buyers step in. However, if selling pressure remains strong, further losses could occur before any significant recovery.

Looking ahead, HYPE is approaching a critical support zone. If this level holds, it may stabilize and attempt to reclaim lost ground. However, if the downtrend continues, HYPE could break below key support, extending its losses.

On the upside, if the HyperEVM launch manages to spark renewed buying interest, HYPE could test resistance at higher levels. A breakout above these key points could signal a shift in sentiment, potentially pushing the price toward previous highs. The market’s reaction to the HyperEVM launch will be a decisive factor in determining whether HYPE can reverse its current downtrend or face continued pressure.