Is Short Dominance Over?...XRP Market Finally Shows Signs of Reversal

▲ Ripple (XRP) ©Go Dasol

Despite a tedious sideways trend, XRP (Ripple) is sending 'reversal signals' in the derivatives market first, increasing the possibility of a directional shift.

According to cryptocurrency specialized media Bitcoinist on May 1st (local time), XRP is currently maintaining a long-term box range around $1.35, but a clear change in investor sentiment is being detected in the derivatives market. According to the Arabchain report, the 30-day moving average of Binance's funding rate has risen to 0.0002, reaching its highest level since early February.

This is a significant change. For the past several months, the funding rate has consistently remained in negative territory, dropping to as low as -0.0007, reflecting short position dominance and thus strong bearish sentiment. However, with the recent shift to positive and continued upward trend, it is interpreted that the market's expected direction is slowly changing with an increase in long positions.

In particular, the rise in the 30-day average indicates a trend change rather than short-term noise. Generally, the derivatives market tends to move before the spot market, so even when prices are stagnant, it is highly likely that directional accumulation is underway internally, according to analysis.

However, caution about overheating remains. This is because a rapid rise in the funding rate could lead to an excessive accumulation of long positions, potentially triggering a sharp decline. While the current level of 0.0002 is considered an early stage of increase, the possibility of future overheating is identified as a key variable.

The price structure is still in a box range. XRP is showing a converging trend between the support level of approximately $1.30 and the resistance level of $1.45, and trading volume is also decreasing, indicating no clear buying or selling dominance. A breakthrough of $1.45 could be interpreted as a signal for an upward reversal, but conversely, a break below $1.30 would open the possibility of a renewed decline.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*