Hyperliquid (HYPE) breaks bearish channel as smart money piles in, eyes ~30% rally
Hyperliquid (HYPE) has confirmed a breakout from a multi-month descending parallel (bearish) channel on the daily chart, supported by renewed accumulation from ’smart money’ investors and protocol token burns. HYPE rallied for a fifth consecutive day on Jan. 7, rising 17.5% from its Jan. 2 low to an intraday high of $28.20 and about 26% from its December low of $22.30. On-chain data from Nansen shows institutional and notable wallets increasing positions—examples include Maven 11 adding 161.3K HYPE (bringing its holdings to ~$4.5M) and a16z Crypto and Borderless Capital adding roughly 42.3K HYPE combined. Hyperliquid’s aggressive buyback-and-burns are another catalyst: the protocol burned nearly $912 million worth of HYPE in late December, reducing circulating supply and likely increasing scarcity. Technical indicators show short-term bullish bias: MACD bullish crossover with expanding green histogram and Chaikin Money Flow at +0.22, indicating momentum and capital inflows. Measured target from the breakout aligns with the Dec. 4 high of $35.80—approximately 30% above current levels at publication. Market data snapshot at press time: HYPE ~$27.25, 24h volume $305M, market cap ~$6.5B. Disclosure: Not investment advice.
Bullish
The article describes multiple bullish drivers: a confirmed breakout from a long-term descending channel, concentrated accumulation by institutional/’smart money’ wallets, large protocol buybacks and token burns, and short-term technical momentum (MACD bullish crossover, positive Chaikin Money Flow). Breakouts from descending channels accompanied by on-chain accumulation and supply-reducing burns historically increase the probability of follow-through rallies, especially when institutional wallets add meaningful positions—this can attract retail FOMO and increase liquidity. Short-term impact: likely increased volatility and upside pressure as traders chase the breakout toward the measured target near $35.8 (~30% upside). Expect higher volume and possible quick profit-taking at resistance levels. Medium-to-long term: sustained bullish case depends on continued demand, further on-chain accumulation, and absence of broad crypto market sell-offs; large token burns support scarcity but do not guarantee price retention if macro conditions reverse. Similar past events: tokens that combined smart-money accumulation + burns (e.g., selective protocol buybacks) often saw multi-week rallies but also sharp corrections if broader market risk-off occurred. Risk factors include market-wide downturns, reversal back into the channel (failed breakout), or concentrated whale sell-offs.