Ripple’s XRP Faces Downward Pressure Amid Market Volatility
Ripple’s XRP is struggling to rebound after a three-day losing streak. A broad cryptocurrency market sell-off has left many investors reeling, with XRP currently trading at $2.98, a 16% drop from its all-time high of $3.66 reached on July 18.
XRP Dips Below $3.00 as Liquidations Surge
The XRP derivatives market is experiencing turbulence following the extended correction from its record high. Data reveals liquidations totaling $41.4 million in the past 24 hours, with long position holders accounting for the majority at $39 million.
The subsequent decline in futures Open Interest (OI) and volume highlights XRP’s upwardly heavy structure, potentially keeping the price suppressed in the coming sessions.
The nominal value of all outstanding futures or options contracts averages $8.13 billion, a 26% decrease from July’s peak of $10.94 billion. This indicates that fewer traders are betting on XRP price increases.
Technical Outlook: XRP Signals Bearish Trends
XRP exhibits a weakened technical structure on the daily chart, underscored by multiple bearish signals, including a downward-trending Relative Strength Index (RSI).
After peaking at 88 in overbought territory, the RSI now sits slightly below the midline, signaling a decrease in buying pressure. The downtrend could extend further towards the 50-day Exponential Moving Average (EMA), providing support at $2.77 if investors maintain a risk-averse sentiment in the broader cryptocurrency market.
A sell signal triggered by the Moving Average Convergence Divergence (MACD) indicator encourages investors to reduce their exposure while waiting to buy XRP again at a lower price.
Risk sentiment could remain elevated as long as the MACD blue line stays below the red signal line, while the momentum indicator descends towards the midline.
Key levels to watch in the coming sessions include support at $2.77, or the 50-day EMA, and the pivotal zone of $3.00, as well as resistance at $3.32. A break on either side of this range could determine XRP’s direction in August.
Low spot trading volume, currently at $168 million, suggests that seller exhaustion is beginning to manifest. Therefore, an increase in speculative demand could positively impact XRP’s price, reaffirming the bullish outlook towards the all-time high.
The XRP Spot bubble map supports the decline in spot volume. Low trading volume suggests decreased liquidity characterized by fewer buyers and sellers. XRP’s price could consolidate near the $3.00 support before the next significant move occurs.
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