XRP eyes breakout as accumulation builds, derivatives market lags
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Investor Accumulation Signals Strength, but Derivatives Traders Stay Cautious
XRP is attempting a recovery, gaining 2% in early Asian trading, as on-chain metrics indicate strong accumulation following the February 3 market correction. The Mean Coin Age metric is in an uptrend, suggesting that holders are reducing sell pressure and accumulating more XRP, reinforcing network-wide confidence. Despite this, the derivatives market remains weak, with open interest dropping over 30% in the past week, from 2.05 billion XRP to 1.42 billion XRP. Negative funding rates have surfaced multiple times, reflecting hesitation among leveraged traders who are waiting for clearer market signals before re-entering positions. The 30-day MVRV Ratio, which measures short-term profitability, recently hit -17%, a level that has previously preceded strong rallies. Historically, when XRP’s MVRV ratio has reached such low levels, price surges of over 60% have followed. If this pattern holds, XRP could be positioned for another upward move.
Key Price Levels: XRP at a Crossroads
XRP has been consolidating within a tight range between $2.26 and $2.55, creating a key rectangular channel that traders are watching closely. A break above $2.55 could shift momentum, pushing XRP toward the next resistance at $2.72, which could attract new bullish bets and accelerate price momentum. On the downside, failure to hold the $2.26 support level could trigger a long squeeze exceeding $80 million, potentially forcing prices down toward $1.96. The Relative Strength Index (RSI) and Stochastic Oscillator are both hovering above neutral, signaling short-term bullish momentum but leaving room for volatility.
Market Catalysts: ETF Speculation and Broader Crypto Sentiment
Regulatory developments remain a wildcard, with the SEC acknowledging Grayscale’s XRP ETF filing, a move that Bloomberg analysts assign a 65% chance of approval. If an XRP ETF is approved, institutional demand could provide a significant tailwind for price appreciation, mirroring Bitcoin’s rally after its ETF debut. The broader crypto market remains in a consolidation phase, with risk appetite fluctuating amid macroeconomic concerns. The February 2-3 sell-off was largely driven by fears of a global trade war, which impacted liquidity across digital assets. For XRP to reclaim its bullish trajectory, derivatives market participation needs to improve, adding leverage-driven momentum to the existing accumulation trend.
Outlook and Trading Strategy
XRP remains at a pivotal level, with a breakout above $2.55 opening the door to $2.72, while a breakdown below $2.26 risks triggering cascading liquidations down to $1.96. Derivatives market revival will be key, as rising open interest and positive funding rates would signal renewed conviction among speculative traders.
XRP is attempting a recovery, gaining 2% in early Asian trading, as on-chain metrics indicate strong accumulation following the February 3 market correction. The Mean Coin Age metric is in an uptrend, suggesting that holders are reducing sell pressure and accumulating more XRP, reinforcing network-wide confidence. Despite this, the derivatives market remains weak, with open interest dropping over 30% in the past week, from 2.05 billion XRP to 1.42 billion XRP. Negative funding rates have surfaced multiple times, reflecting hesitation among leveraged traders who are waiting for clearer market signals before re-entering positions. The 30-day MVRV Ratio, which measures short-term profitability, recently hit -17%, a level that has previously preceded strong rallies. Historically, when XRP’s MVRV ratio has reached such low levels, price surges of over 60% have followed. If this pattern holds, XRP could be positioned for another upward move.
Key Price Levels: XRP at a Crossroads
XRP has been consolidating within a tight range between $2.26 and $2.55, creating a key rectangular channel that traders are watching closely. A break above $2.55 could shift momentum, pushing XRP toward the next resistance at $2.72, which could attract new bullish bets and accelerate price momentum. On the downside, failure to hold the $2.26 support level could trigger a long squeeze exceeding $80 million, potentially forcing prices down toward $1.96. The Relative Strength Index (RSI) and Stochastic Oscillator are both hovering above neutral, signaling short-term bullish momentum but leaving room for volatility.
Market Catalysts: ETF Speculation and Broader Crypto Sentiment
Regulatory developments remain a wildcard, with the SEC acknowledging Grayscale’s XRP ETF filing, a move that Bloomberg analysts assign a 65% chance of approval. If an XRP ETF is approved, institutional demand could provide a significant tailwind for price appreciation, mirroring Bitcoin’s rally after its ETF debut. The broader crypto market remains in a consolidation phase, with risk appetite fluctuating amid macroeconomic concerns. The February 2-3 sell-off was largely driven by fears of a global trade war, which impacted liquidity across digital assets. For XRP to reclaim its bullish trajectory, derivatives market participation needs to improve, adding leverage-driven momentum to the existing accumulation trend.
Outlook and Trading Strategy
XRP remains at a pivotal level, with a breakout above $2.55 opening the door to $2.72, while a breakdown below $2.26 risks triggering cascading liquidations down to $1.96. Derivatives market revival will be key, as rising open interest and positive funding rates would signal renewed conviction among speculative traders.