XRP gains outpace crypto markets, open interest holds at $540 million

XRP price stagnated at $0.51 on May 2, 2024 Despite swinging along with the market over the past month, derivatives traders have shown remarkable resilience.

XRP Price Outperforms the Market

XRP price saw wild volatility in April, recording a drop of 24% during the month. But it is worth noting that a closer look at recent market activity shows that XRP has outperformed Bitcoin, Ethereum, and the entire cryptocurrency market over the past 10 days.

XRP Price Action

According to the above market data, XRP price has fallen by 10.1% since April 23.

Meanwhile, the “Total Crypto Market Capitalization” chart, which tracks the market capitalization of all listed crypto assets, shows a drop of 13.31 TBTC over the same 10-day period between April 23 and May 2.

This basically shows that XRP price outperformed the entire cryptocurrency market by a margin of 3% in the latest week.

Speculative traders’ optimism about XRP price resilience

Beyond the price chart, recent trends in the derivatives market suggest that optimistic speculative traders are the reason for XRP’s outperformance relative to the cryptocurrency industry as a whole.

The Coinglass “Open Interest” chart below tracks real-time fluctuations in the value of active futures contracts for a specific crypto asset.

On April 23, XRP’s open interest was $562.3 million. As of the time of publication on May 2, that figure had fallen to $540.2 million, a $22 million deficit representing a decline of 4%.

Meanwhile, XRP price fell by 10.1% during the same 10-day period between April 23 and May 2.

When open interest remains stable relative to price declines, strategic investors may interpret this as a bullish signal.

First, it suggests that despite the price drop, market participants are maintaining their positions, buying hedges rather than selling. The continued interest in XRP shows that existing holders have confidence in it.

Second, relatively stable open interest could indicate seller exhaustion, which is often a precursor to a rally phase.

XRP Price Prediction: Bulls See $0.50 Support Retained

As can be inferred from the market data analyzed above, a steady open interest could keep the XRP price above $0.50 for the next few days. However, the prospects of a clear rebound in XRP price back towards $0.60 still largely depends on whether demand returns to the entire cryptocurrency market.

It is worth mentioning that the Bollinger Band technical indicator shows that XRP is currently trading just above the 20-day simple moving average at $0.51, which puts the bulls at an advantage in the short term.

If the bulls extend the recovery phase further, they might face significant resistance at $0.55, as indicated by the upper Bollinger Band indicator.

Conversely, if XRP loses the psychological support of $0.45, the bears are likely to take control of the situation. However, such an outcome seems unlikely in the short term as open interest remains stable and potential buying has emerged at the $0.48 level.

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