XRP’s price reached a standstill at $0.51 on May 2, 2024. Despite experiencing fluctuations in the market throughout the past month, derivatives traders have shown impressive resilience.
XRP has been outperforming the market despite facing volatile swings in April, resulting in a 24% decline for the month. However, a closer examination of recent market activity reveals that XRP has actually performed better than Bitcoin, Ethereum, and the broader crypto market in the last 10 days.
Since April 23, XRP’s price has declined by 10.1%, as indicated by the market data shown above. In contrast, the total crypto market capitalization, represented by the TOTAL CRYPTOCAP chart, has experienced a 13.3% decline during the same 10-day timeframe between April 23 and May 2. This suggests that XRP has outperformed the overall crypto market by a margin of 3% in the recent week.
Looking beyond the price charts, trends observed in the derivatives markets indicate that optimistic speculative traders are responsible for XRP’s resilient price performance relative to the broader crypto sector. The Open Interest chart provided by Coinglass tracks the value of active futures contracts opened for XRP. On April 23, XRP’s open interest was $562.3 million, which has decreased to $540.2 million as of May 2. Although this represents a 4% decline, it is smaller compared to the 10.1% drop in XRP’s price during the same period.
When open interest remains stable with smaller declines in comparison to price, strategic investors interpret it as a bullish signal. It suggests that market participants are maintaining their positions and making hedge purchases rather than exiting. This continued interest in XRP shows confidence among existing holders. Additionally, the relatively stable open interest may indicate fatigue among sellers, which often precedes a rebound phase.
Based on the analyzed market data, a stable open interest could potentially keep XRP’s price above $0.50 in the coming days. However, a definitive rebound towards $0.60 largely depends on the return of demand in the broader crypto market.
The Bollinger bands technical indicator shows that XRP is currently trading just above the 20-day SMA at $0.51, giving the bulls an advantage in the short term. If the bulls continue to push for recovery, they may encounter significant resistance at $0.55, as indicated by the upper-limit Bollinger band indicator.
On the other hand, if XRP loses the psychological support at $0.45, the bears could take control. However, this scenario seems unlikely in the near term due to the steady open interest and a potential buy-wall at the $0.48 level.
It is important to note that this article provides informational content and should not be considered financial advice. The opinions expressed in this article are the author’s personal views and do not reflect the opinion of The Crypto Basic. Readers are advised to conduct thorough research before making any investment decisions. The Crypto Basic is not liable for any financial losses incurred.