Today, the crypto market witnessed a slight sell-off, with Bitcoin slipping below its crucial $26,500 mark, dragging the market into a dip. This downturn was influenced by a shift in funds and growing investor interest in rising altcoins such as ChainLink. Yet, XRP didn’t benefit from this capital influx and dipped under $0.5. Despite this, various on-chain indicators hint at increased bullish momentum, pointing to a potential ‘buy the dip’ opportunity for the altcoin.
XRP Traders Bet Against Price Drop
Amid today’s sell-off, XRP experienced a significant liquidation, struggling to find buying interest above the $0.5 level. This led to many investors closing their long positions, weakening XRP’s resistance level. Data from Coinglass indicates that long positions worth over $2 million were liquidated as XRP’s price dipped below $0.5.
Yet, the sentiment shifted when XRP reached the $0.49 low, indicating a surge in buying interest near this dip. The current long/short ratio stands at 1.16, tilting in favor of bulls who opened positions on the $0.49 dip. The data suggests a bullish sentiment among traders, with long positions making up 53.9% and short positions at 46.1%.
One of the most telling metrics, the Open Interest (OI) – representing the total count of active futures contracts – has witnessed a notable surge, increasing by $17 million. This uptick in OI is a clear sign of increased trading activity, especially as the price trades near the $0.49 mark. Such a trend suggests that traders are actively becoming bullish at this price point, building a robust support level.
The growing activity around this dip could increase the possibility that XRP might initiate a recovery rally in the coming days. If this momentum holds, we could see a comeback in XRP’s price.
What’s Next For XRP Price?
XRP’s price dropped below its EMA lines in recent hours, weakening the hopes of a bullish comeback. However, bulls are strongly defending a decline below the dip of $0.49 as new buyers joined the market. Currently, buyers are aiming to push the price above EMA20 to strengthen long positions. As of writing, XRP price trades at $0.497, declining over 2.6% from yesterday’s rate.
The price is currently testing $0.486, a crucial support level to monitor. If the price rebounds from here, it indicates a shift in market sentiment from selling at highs to purchasing at lowes. This could lead the bulls to push the price past the resistance zone between $0.525 and $0.56.
However, if the support of $0.486 is breached, the altcoin might decline towards the next support of $0.459. It’s vital for the bulls to hold this line, as any drop below it would negate the bullish outlook and plunge the XRP price toward $0.42. As the RSI level has reversed its trend from the oversold region and currently trades around 36, it holds bulls’ confidence.
