"Consolidation Comes Before a Surge"...Hyperliquid's $50 Dream Fades?

▲ Hyperliquid (Hyperliquid, HYPE)/AI generated image

An analysis suggests that while Hyperliquid (Hyperliquid, HYPE) maintains a relatively robust market structure compared to other altcoins, its recent attempt to break past $50 has lost momentum. After a strong rebound from its early-year lows and recovering key moving averages, expectations for entering a new surge phase grew, but the immediate possibility of a vertical ascent has now diminished.

U.Today reported on May 11 that Hyperliquid quickly rebounded from the mid-$20s to the early $40s, but its upward momentum stalled at a strong resistance zone between $44 and $46. As the price approached this zone, buying interest weakened, and a pattern of lower highs emerged in shorter timeframes.

The first reason for the failed ascent was cited as fatigue near the resistance line. Hyperliquid showed an aggressive rebound over a relatively short period, but it failed to maintain pressure above the $44-$46 resistance zone. This weakened expectations for a break past $50, and the market moved closer to a consolidation phase rather than a strong trend continuation.

Slowing momentum also acted as a burden. During the recent breakout attempt, the Relative Strength Index (RSI) was noticeably lower than in previous upward phases, and trading volume decreased. While expanded market participation is necessary for a strong further rally, Hyperliquid is currently shifting towards a more cautious structure where buyers and sellers are more balanced.

Changes in market capital rotation were also cited as a factor weakening Hyperliquid's upward trend. Earlier this year, investor interest in the perpetual futures trading ecosystem and fast decentralized infrastructure worked favorably for Hyperliquid. However, recent shifts in interest towards Bitcoin (BTC), memecoins, and privacy assets have diminished the additional inflow momentum needed for Hyperliquid to break through overhead resistance.

Technically, Hyperliquid still remains above its 50 and 100 Exponential Moving Averages (EMAs). This is interpreted to mean that the larger recovery structure has not been entirely damaged. However, analysis suggests that investors should focus on the possibility of consolidation in the early to mid-$40s rather than immediately expecting a surge to $50. There is also a possibility of a deeper retreat towards key support zones if the overall cryptocurrency market declines.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*