XRP has experienced a small drop in value in recent days, coinciding with a period of consolidation in the broader context cryptocurrency market after four weeks of consecutive price increases.
Although data from CoinMarketCap at the time of writing indicates this XRP Although the price is up 1.78% in the last 24 hours, a larger seven-day time frame shows that the price is still down 8.68%. On the other hand, price metrics including open interest on futures contracts and a bullish divergence with the RSI indicate the potential for a significant increase in the token’s value in the near future.
Crypto Analyst Sees Solid XRP Price Action
According to crypto analyst Will Taylor, known as Cryptoinsightsuk on social media, XRP is showing signs of bullish momentum that could push the price towards its $1.35 target. The analyst took to social media platform X to point out two metrics that point to a bullish price and explain their meaning.
Finally, $XRP.$XRP actually looks quite different from the other graphs I just discussed.
$100M+ of OI was added to the market during the marked peak (on the day of the fake ETF news).
Since then, the price has fallen and the OI has remained relatively flat. This… https://t.co/qkruUPopJ7 pic.twitter.com/SY9pEZs5mr
— Cryptoinsightuk (@Cryptoinsightuk) November 17, 2023
Exchange data shows that more than $100 million in open interest on futures contracts was added to the XRP ecosystem on the day of the fake news around BlackRock’s XRP ETF filing. XRP also experienced one significant price increase of 16% up to $0.75 at a time. However, Cryptoinsightsuk pointed out that while the crypto has since lost this price spike, the amount of open interest has remained relatively the same.
According to the analyst, the fact that open interest on futures contracts remains the same because the price of XRP has fallen means they are likely short trade positions. “This shows me that there are HUGE shorts on $XRP right now,” he said.
Glancing at the price chart provided by the trader indicates the formation of lower highs and lower lows by XRP. The recent action has been an upswing and is now approaching the descending upper trendline formed by the lower highs. He noted that a break above the descending trendline could be the start of an uptrend for XRP.
Total crypto market cap is currently at $1.3 trillion. Chart: TradingView.com
This could encourage people to cover or close out their open short positions by placing buy trades, which in turn could lead to a more aggressive breakout in the market.
“This could push stop losses higher and push XRP into a fast move,” he said.
Bullish divergence with the RSI
The trader also noted that the recent creation of a higher low in the price of XRP created a bullish divergence with the RSI overbought/oversold indicator. This bullish divergence shows that bulls are about to regain control of the market and bears are starting to lose momentum.
“XRP will be driven to my target range of $0.89 – $1.35,” he predicted.
Cryptoinsightuk initially had created a daily countdown for an XRP price increase to a target of $1.06. however, the the countdown is over and XRP has yet to take off.
“I was wrong about the date, but I think this is inevitable,” the analyst said.
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