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Hyperliquid’s HYPE token has surged 55% in a single week and delivered more than 130% in year-to-date returns — but prominent crypto analyst Ali Martinez (@alicharts) is warning that the asset is now approaching a critical resistance zone with multiple technical indicators flashing sell signals simultaneously, a setup he says could trigger a retracement toward $40 if momentum fades at current levels.
In a post on X, Martinez laid out the technical case with precision. Three converging signals are appearing on HYPE at the same time: the TD Sequential Combo 13 sell signal is already active, a standard green 9 sell signal could confirm as early as the next session, and both the Relative Strength Index (RSI) and the Chande Momentum Oscillator are sitting at historically elevated — or overheated — levels, per the analyst’s 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 Concerns Martinez
The significance of the current configuration lies in precedent. According to Martinez’s post, the last two occasions when 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 does leave room for one final push before any reversal materializes. HYPE could still push toward $59 or even slightly above $60 before momentum fades, he notes — but frames that move as a potential exhaustion run rather than the beginning of a new leg higher. If rejection comes from the $59–$60 area, a retracement toward approximately $40 becomes increasingly likely, per his assessment.
That would represent a pullback of roughly 33% from the upper resistance zone — meaningful, but consistent with the corrections that followed the previous two sell signal setups he references.
ZCash Flashing A Similar Warning
Martinez also flagged ZCash in the same post, noting a comparable technical structure after a 40%-plus weekly surge. ZCash is approaching the same resistance zone that triggered a major rejection in November — around the $700–$730 area — with the TD Sequential now flashing a sell signal on the weekly chart.
Because the signal appears on the weekly timeframe, Martinez warns the potential correction could be substantially larger, with first downside support near $500 and a deeper retracement potentially reaching $380.
The parallel between the two assets is notable given that BitMEX founder Arthur Hayes has 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 of two of his highest-conviction calls simultaneously.
As of this writing, HYPE trades at around $56, consolidating just below the critical $59–$60 resistance zone that Martinez has identified as the make-or-break level for the near-term price trajectory.
Cover image from Perplexity, HYPEUSD Chart from Tradingview
