XRP News Today: XRP open interest drops 30% signaling potential buy zone below $2.50

XRP futures open interest has dropped by 30% over the past month, falling from $11 billion to $7.7 billion, according to recent market data [1]. This decline is seen as a sign of reduced speculative activity, with traders potentially locking in profits or shifting positions amid a pullback in price from a high of $3.66 to current levels below $3. Analysts suggest that this shift in open interest may signal the emergence of a potential buying zone, particularly if the price continues to consolidate below $2.50 [1].

Historically, XRP has exhibited patterns where open interest drops coincide with price consolidation or re-entry opportunities. A similar dynamic occurred in Q1 2024 when open interest fell by 65%, from $8.5 billion to $3 billion, alongside a more than 50% drop in spot price. While the current decline is less severe, the market structure shows signs of stabilization, with a fair value gap identified between $2.33 and $2.65 as a probable demand zone [1]. This range could serve as a critical support level if selling pressure persists.

The current open interest drop appears to be unfolding in a controlled manner. Liquidation levels remain subdued, with only $22 million in long positions wiped out on a recent down day and $56 million during an August 14 pullback. These figures suggest that the market is not experiencing the kind of cascading sell pressure seen in overheated conditions, reducing the risk of a deeper correction [1]. The absence of aggressive bearish liquidations implies that a more measured correction is taking place, potentially creating a favorable environment for accumulation.

At the same time, data from CryptoQuant indicates that large whale investors—those holding between 100,000 and 1 million XRP—have been active in moving assets to exchanges, a pattern historically observed ahead of major market tops [1]. This increased exchange inflow, while often interpreted as a sign of profit-taking, could also indicate that large holders are preparing for potential volatility, reinforcing the view that short-term near-term selling pressure remains a factor.

Despite these near-term challenges, XRP’s broader technical and structural trend remains intact. Analysts note that the long-term target for XRP remains above $5 in 2025, with the current volatility seen as a normal part of the cyclical process [1]. A strong defense of the $3 level could rekindle bullish momentum and set the stage for further gains, particularly if open interest stabilizes and finds a new base range.

In conclusion, while the 30% drop in open interest raises caution, it also presents potential opportunities for buyers to enter the market at attractive levels, particularly if XRP holds within the $2.33–$2.65 zone. The market will need to demonstrate resilience in the coming weeks to confirm that the current consolidation phase is setting the foundation for a new bullish cycle.

Source:

[1] Cointelegraph. "XRP 30% open interest drop may open buy zone below $2.50."

URL: https://cointelegraph.com/news/xrp-30percent-open-interest-drop-may-open-buy-zone-below-dollar2-50?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound