Hyperliquid’s HYPE token is up 55% in one week and has returned more than 130% year-to-date — but prominent crypto analyst Ali Martinez (@alicharts) warns that the asset is now approaching a critical resistance zone with multiple technical indicators simultaneously flashing sell signals, a setup he says could trigger a move back towards $40 if momentum fades from current levels.
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In a post on X, Martinez laid out the technical case in detail. Three converging signals appear on HYPE at the same time: the TD Sequential Combo 13 sell signal is already active, the standard green 9 sell signal could be confirmed as early as the next session, and the relative strength index (RSI) and Chande Momentum oscillator are at historically elevated — or overheated — levels, according to analyst analysis.
HYPE's price trends to the upside following a surge in institutional adoption, as seen on the daily chart. Source: HYPEUSD on Tradingview
Why the setup worries Martinez
The significance of the current configuration lies in precedent. According to Martinez’s post, the last two occasions when the TD Sequential sell signals appeared on HYPE while the RSI and Chande Momentum Oscillator were simultaneously at overheated levels, both instances led to significant corrections. The analyst is not pointing to isolated indicators — he is pointing to a specific combination of signals that has already proven consequential twice in HYPE’s relatively short price history.
HYPE's price entering a dangerous area if the asset can't sustain its current bullish momentum, as seen on the TD Sequential Indicator. Source: Ali Martinez on X
The analyst still leaves room for one final push before any reversal materializes. HYPE could still move toward $59 or even a little above $60 before the momentum fades, he notes — but the frames moving as potential exhaustion go further than the start of a new move. If the bounce comes from the $59-$60 area, a pullback towards around $40 is increasingly likely in his view.
That would represent a roughly 33% pullback from the upper resistance zone – significant, but in line with the corrections that followed the previous two sell signal setups he mentions.
ZCash flashes a similar warning
Martinez also tagged ZCash in the same post, noting a comparable technical structure after a weekly surge of more than 40%. ZCash is approaching the same resistance zone that triggered the big bounce back in November — around the $700-$730 area — with the TD Sequential now giving a sell signal on the weekly chart.
As the signal appears on the weekly time frame, Martinez warns that the potential correction could be much larger, with the first downward support near $500 and a deeper pullback that could potentially reach $380.
The parallel between the two assets is notable given that BitMEX founder Arthur Hayes publicly disclosed large positions in both HYPE and ZCash — with a $150 HYPE target and a $10,000 long-term ZCash target — making the current resistance zone a critical test for two of his highest conviction calls simultaneously.
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As of this writing, HYPE is trading at around $56, consolidating just below the critical $59-$60 resistance zone that Martinez identified as a bullish or breakout level for the short-term price path.
Cover image from Perplexity, HYPEUSD chart from Tradingview
