Hyperliquid and Zcash are leading the altcoin market after posting explosive gains in recent weeks. But while momentum remains strong, analysts now warn that rising social hype, overbought technical indicators, and crowded positioning could increase the risk of a sharp pullback.
Hyperliquid Rally Pushes Toward Critical Resistance
Hyperliquid traded near $59 on May 22 after climbing nearly 30% in the past week and more than 45% over the last month. The token recently hit a new all-time high of $62.18, making it one of the strongest-performing large-cap crypto assets despite broader market weakness.
Market momentum around HYPE has accelerated alongside growing investor attention. Analysts pointed to rising ETF interest and increasing DeFi speculation as key drivers behind the move. Social media activity around the token has also surged to record levels, showing how quickly traders have piled into the rally.
Still, heavy social attention can sometimes signal growing market risk rather than strength. When too many traders enter a trade late, rallies often become vulnerable to sudden reversals.
Analysts Warn HYPE Could Face Exhaustion
Technical analysts now believe Hyperliquid may be approaching a critical resistance zone near the $60 level. According to Ali Martinez, several momentum indicators are flashing warning signs, including an overbought RSI reading and a TD Sequential Combo 13 sell signal.
The analyst noted that HYPE could still briefly move above $60 before momentum fades. However, if sellers reject the rally from that area, price action could weaken significantly, with downside targets potentially extending toward $40.
Despite the caution, institutional developments continue supporting the broader bullish trend. Asset manager 21Shares recently launched the first U.S. exchange-traded funds linked to HYPE, including a spot ETF with staking exposure. The company said Hyperliquid processes roughly $8 billion in daily trading volume and allocates more than 95% of protocol fees toward HYPE buybacks.
Meanwhile, Bitwise also tied part of its ETF fee structure to HYPE accumulation, reinforcing longer-term demand for the token.
Zcash Rally Approaches Major Test
Zcash has also posted one of the strongest rallies in the crypto market. The privacy-focused cryptocurrency traded near $645 on May 22 after gaining more than 100% over the past 30 days.
The rally pushed ZEC close to the key $700 resistance zone before facing a mild pullback. Traders are now watching whether buyers can regain momentum and attempt another breakout toward higher levels.
Recent market optimism around Zcash has been fueled by improving regulatory sentiment, institutional accumulation, and stronger technical momentum following a confirmed bull flag breakout.
Analyst Ardi also suggested the move appears driven more by mid-sized and institutional flows rather than retail traders. According to the analysis, retail participation remained relatively flat while larger buyers gradually returned after the correction.
ZEC Traders Watch for Pullback Signals
Even with strong momentum, analysts believe Zcash now faces an important technical test. Ali Charts noted that ZEC has entered the same $700 to $730 range that triggered a major rejection in November.
The analyst also warned that the TD Sequential indicator is flashing a weekly sell signal, which could indicate a larger correction rather than a short-term dip. Initial downside support sits near $500, while deeper retracement targets could extend toward $380 if momentum weakens further.
Earlier reports also highlighted concerns about leverage-heavy trading conditions. Analysts warned that weaker spot demand combined with elevated perpetual futures activity could expose ZEC to faster reversals if bullish momentum slows.
At the same time, bullish long-term expectations remain active. Rising demand for privacy-focused assets, a recent golden cross formation, and disclosures from institutional investors such as Multicoin Capital continue supporting positive sentiment around Zcash.
