The crypto market’s current bearish sentiment is impacting even tokens with solid fundamentals, as traders shift their focus from long-term holding to selling on short-term price fluctuations. Notably, XRP, one of the notable tokens by market cap, has seen a reversal of its gains following Ripple Labs’ pivotal court victory against the SEC in July. The recent market crash, combined with the SEC’s decision to appeal the court’s ruling, brought a surge in selling activity. This raises concerns about XRP potentially falling below the significant $0.5 level.
Traders Show Less Interest In XRP’s Future Positions
As XRP failed to meet traders’ expectations, there has been a significant decline in XRP’s future positions. On-chain data reveals a continuous decrease in XRP’s open interest over the past six days. The open interest metric fell from $700 million on August 17 to $440 million, as of today.
Declining open interest is bearish for XRP because it indicates a decrease in the number of active contracts or positions in the market. A drop in open interest suggests that traders are closing their positions, which can be concluded as a lack of confidence in the token’s future price movement.
In the context of XRP, a falling open interest might imply that traders are becoming less interested or optimistic about its potential upside, signaling a bearish sentiment.
However, XRP’s RSI level brings bullish confidence among holders. As seen on the daily price chart, the RSI level has formed a ‘V’ shape and currently trades near the oversold region at level 33. This suggests a possible recovery or a temporary uptick in the near future for XRP’s price.
Will XRP Decline Below $0.5?
Despite strong selling pressure from bears, buyers successfully rebounded the XRP price above the 20-day EMA trend line at $0.5232. Currently, there’s an intense battle between bulls and bears to trigger a clear move. As of writing, XRP price trades at $0.523, surging over 1.7% in the last 24 hours.
The bearish forces seem to be halting the upward momentum around $0.56, suggesting a rising negative sentiment as traders opt to sell during minor upward rallies. If the price declines and drops below its current consolidation near $0.52, it will suggest that the XRP price might hover between $0.45 and $0.49 for some time.
On the 4-hour price chart, the stable EMA trend lines and the RSI surged above the midline with a current level of 52, hinting at a bullish comeback. A clear sign of bullish momentum would be a sustained break above $0.58, indicating a potential decrease in bearish intensity. This could push the price to test its resistance near the upward trend line of $0.64.
This article is added for educational purpose only. All credit goes to the respected author of this article. All In One Crypto App do not hold any liabilities of this article. You can get the source link at the end of the article content.
Don't forget to share your review/suggestions for the android app.
All In One Crypto App is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as investment advice. Any opinion that may be provided on this page does not constitute a recommendation by All In One Crypto App or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risks