Ripple Price Forecast: XRP turns green amid waning exchange inflows
- XRP price indicators send multiple buy signals, supported by low exchange inflows.
- The SuperTrend turns green for the first time since March, setting the stage for gains toward $3.00.
- Surging long positions liquidations alongside falling Open Interest may slow XRP's uptrend.
Ripple (XRP) price continues its upward trajectory, trading at $2.40 on Monday, fuelled by a widespread bullish surge spearheaded by Bitcoin (BTC) breaking past the $100,000 mark last week. Multiple buy signals suggest that XRP can potentially extend the rally, targeting $3.00 in the coming days.
XRP gains momentum as exchange inflows diminish
XRP's price has broken above a long-term descending trendline resistance, mirroring positive sentiment across the crypto market. The uptrend above the trendline comes amid a major slump in exchange inflows from over 2 billion to 14.5 million XRP, per CryptoQuant data.
Falling exchange inflows often signal reduced sell-side pressure, as investors prefer to hold onto their tokens in self-custody as opposed to moving them to exchanges.
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Exchange inflows | Source: CryptoQuant
Meanwhile, the daily chart reveals a solid bullish structure supported by multiple buy signals. The SuperTrend recently shifted below XRP's price, supporting the ongoing uptrend. This trend-following indicator signals when to buy and when to sell.
When XRP's price is above the SuperTrend line, it signals a bullish momentum. For instance, around late November 2024, the price broke above the Supertrend line, marking the start of a major bullish phase that propelled XRP from around $0.50 to a peak near $3.38 by mid-January.
With the SuperTrend line below XRP's price, dynamics could favour a larger-than-expected breakout aiming for highs above $3.00.
The Moving Average Convergence Divergence (MACD) indicator shows a clear uptrend above the center line. The MACD line (0.0557) above the signal line (0.0318) signals a robust bullish momentum.
Similarly, the expanding green histograms confirm this short-term bullish outlook, corroborated by the Relative Strength Index (RSI) at 61.77. The RSI indicator shows that XRP is neither overbought nor oversold, leaving room for more bullish wiggle.
XRP/USDT daily chart
Declining Open Interest may hinder XRP's upward momentum
Derivatives data from CoinGlass reveals a 2.21% drop in Open Interest (OI) to $6.64 billion and a 27.24% decline in the trading volume to $5.74 billion. OI represents the total number of outstanding derivative contracts that haven't been settled, like futures or options.
When OI falls, it signals that traders are closing positions, reflecting reduced confidence or interest in XRP's price direction. Coupled with the drop in trading volume, the uptrend could face significant challenges.
XRP derivatives data | Source: CoinGlass
Long positions liquidation reached $8.85 million in the last 24 hours compared to approximately $762,000 in shorts. A total of $9.61 million has been wiped out, implying that the market is volatile, calling for caution among traders betting on a price increase to $3.00.
Ripple FAQs
Ripple is a payments company that specializes in cross-border remittance. The company does this by leveraging blockchain technology. RippleNet is a network used for payments transfer created by Ripple Labs Inc. and is open to financial institutions worldwide. The company also leverages the XRP token.
XRP is the native token of the decentralized blockchain XRPLedger. The token is used by Ripple Labs to facilitate transactions on the XRPLedger, helping financial institutions transfer value in a borderless manner. XRP therefore facilitates trustless and instant payments on the XRPLedger chain, helping financial firms save on the cost of transacting worldwide.
XRPLedger is based on a distributed ledger technology and the blockchain using XRP to power transactions. The ledger is different from other blockchains as it has a built-in inflammatory protocol that helps fight spam and distributed denial-of-service (DDOS) attacks. The XRPL is maintained by a peer-to-peer network known as the global XRP Ledger community.
XRP uses the interledger standard. This is a blockchain protocol that aids payments across different networks. For instance, XRP’s blockchain can connect the ledgers of two or more banks. This effectively removes intermediaries and the need for centralization in the system. XRP acts as the native token of the XRPLedger blockchain engineered by Jed McCaleb, Arthur Britto and David Schwartz.
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