Hyperliquid, Losing Public Interest, Why Is the Derivatives Market Storm-Buying?

▲ Hyperliquid (HYPE), USD/ChatGPT generated image ©

Hyperliquid (HYPE), which previously garnered explosive attention amid Middle Eastern tensions by supporting crude oil futures trading, is currently drawing market focus as it firmly holds the $40 mark despite a recent decline in public interest, preparing for a new rally.

According to investment media FXStreet on April 27 (local time), Hyperliquid was trading around $42 as of Monday, maintaining a rebound within a rising wedge pattern. With recent efforts for a peace agreement between the US and Iran easing geopolitical tensions in the Middle East, individual investors' interest in this decentralized exchange, which offers 365-day crude oil futures trading, has somewhat waned. According to blockchain data analysis platform Santiment, Hyperliquid's social share plummeted from 0.688% on March 30, when the conflict was at its peak, to its current 0.137%.

However, in contrast to the cooling public interest, the derivatives market is rapidly building short-term positions targeting a bull run. According to CoinGlass data, Hyperliquid's open interest increased by approximately 3% over the past 24 hours, reaching $1.66 billion, indicating a significant rise in the nominal value of outstanding contracts. Furthermore, funding rates have mostly remained positive over the past month, currently at 0.0077%, proving that the buying sentiment among traders utilizing leverage remains robust.

From a technical analysis perspective, Hyperliquid is also charting a positive trajectory on the daily chart, forming a rising wedge pattern between two gradually converging trendlines. The current price is above both the 50-day exponential moving average (EMA) of $38.98 and the 200-day EMA of $34.90, establishing a solid floor.

Auxiliary indicators also suggest a favorable environment for buyers. The Relative Strength Index (RSI) on the daily chart is at 57, showing stable bullish momentum without reaching an overbought state. Simultaneously, the Moving Average Convergence Divergence (MACD) is also gradually rising towards the signal line, indicating that the bearish momentum that had been weighing on the market is gradually losing strength.

The first hurdle for a short-term uptrend is the resistance line at $43.71; a breakthrough there could extend the rally to the upper trendline near $46.80. While the overall bullish trend remains valid as the current price is above the uptrend support line near $41.21, there is also a risk of a deep correction to the 50-day EMA at $38.98 and further to the 200-day EMA at $34.90 if this support line breaks.

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