XRP has rebounded from its recent low of $1.89 on March 11, reaching $2.48. However, the cryptocurrency is struggling to break past key resistance levels, raising concerns about its ability to sustain the recovery. The coming days will be crucial in determining whether XRP continues its upward momentum or faces further declines.
Bearish Sentiment Dominates XRP Futures Market
One of the primary indicators of potential trouble for XRP is the negative funding rates in its perpetual futures contracts. Funding rates reflect the payments exchanged between long and short traders to maintain price equilibrium with the spot market.
- Currently, XRP’s funding rates are below 0%, suggesting that short sellers are paying long traders—a strong indication of bearish market sentiment.
- Negative funding rates discourage new buyers, making long positions less attractive and potentially leading to a price drop.
Additionally, open interest (OI) in XRP futures has significantly declined, falling from $5.67 billion on January 17 to $2.4 billion as of March 18. This drop suggests that traders are exiting positions, which historically leads to weakened momentum and increased vulnerability to selling pressure.
XRP’s Technical Indicators Point to Possible Retest of $1.90
XRP’s four-hour chart shows an inverted V-shaped pattern, signaling that the recent buying pressure may have been exhausted. The supply congestion zone between $2.35 and $2.42, where the 100-period and 200-period simple moving averages (SMA) reside, is acting as a major resistance area.
- The Relative Strength Index (RSI) has fallen below 50, reinforcing bearish control.
- A breakdown below the $2.28 – $2.20 support zone (50 SMA) could push XRP toward the critical neckline support at $2.01.
- A close below $2.01 may lead to further declines, possibly testing the February 28 low of $1.94 and the March 11 low of $1.89.
Can XRP Bulls Regain Control?
For a bullish reversal, XRP must hold above the 50 SMA and break the $2.35–$2.42 resistance. A move past these levels could push the price toward $2.47, invalidating the bearish outlook.
Despite the current uncertainty, crypto analyst Dark Defender remains optimistic. In a March 17 post on X (formerly Twitter), he suggested that XRP has “started Wave 1” aiming for $5.85, with $2.22 as support and $3.39 as resistance.
Also Read: XRP Faces Critical Test at $2—Will Bulls Hold or Is $1.60 Next? Analyst
With mixed signals in the market, traders should closely watch key support and resistance levels in the coming weeks.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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