A well-known pseudonymous analyst on X, going by the name Pentoshi, announced on Friday that he initiated a small position in HYPE, the native token of Hyperliquid, and indicated he would consider adding more only if prices decline further.
In his post dated Oct. 17, he noted that he “nibbled” on spot HYPE below $34, which constituted about 20% of his intended position. “Spot” refers to buying the actual token without using leverage, thereby eliminating the risk of forced liquidations. He expressed plans to “load up” at around $28 and “go hard” if prices drop below $30, utilizing a gradual approach to spread out his purchases instead of allocating all his capital in one transaction.
He highlighted that this strategy occurs within a broader downtrend. By “lower highs,” he indicates that each rebound fails to surpass the previous peak—a traditional bearish pattern that often leads to another decline. When he refers to a “broken market structure,” he is highlighting the weakened support areas and sparse order books following last week’s volatility, conditions that could amplify price movements and create whipsaws. The key takeaway is to maintain a small position size, refrain from attempting to pinpoint the exact bottom, and expect that dips can overshoot.
Pentoshi also pointed out a potential supply overhang due to an unstaking queue. In networks that support staking, previously locked tokens are periodically unlocked; if a significant portion of these tokens is sold rather than restaked, the short-term selling pressure may increase. He admitted he is uncertain whether a quarter, a third, or an even smaller portion will enter the market, which is why he’s placing resting bids below the current price, allowing the market to approach him instead of pursuing bullish trends.
Additionally, he mentioned that a recent ether trade that deviated from his guidelines had caused him some losses—though a subsequent bounce helped—leading him to adopt a defensive strategy: smaller positions, pre-established bids, and minimal micromanagement of his current standing in the near future.
Hyperliquid is a decentralized exchange that operates on its own chain and primarily facilitates perpetual futures—derivatives with no expiration date. The HYPE token functions as both a governance asset and an economic stake, allowing holders to vote on upgrades, stake for rewards, and participate in mechanisms that link trading activity and fees to the token’s value. Simply put, Hyperliquid serves as the platform, while HYPE represents how users can partake in its growth.
As per data from CoinDesk, just before publication, HYPE was priced around $36.32, reflecting a 2.1% increase over the last 24 hours.
