XRP ($2.68) is experiencing a strong rebound in the derivatives market as open interest surges to $4.3 billion, signaling renewed trading activity and momentum.
Data from Coinglass shows XRP’s open interest, which measures outstanding futures contracts, dropped significantly before bouncing back. In mid-January, it stood at approximately $7.86 billion. However, by early February, it had plunged to around $3.4 billion following XRP’s price decline to nearly $1.70.
Recent data reveals a resurgence, with open interest climbing to $4.3 billion as of February 16. At present, the figure remains steady around $4 billion, reflecting growing trader participation.
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Price Surge Sparks Speculation
The renewed interest aligns with XRP’s recent price jump to a multi-week high above $2.83. Market watchers see this as a sign of potential price action, fueling discussions within the XRP community.
Community figure Chad Steingraber pointed out that the last time XRP witnessed a significant spike in open interest, it coincided with a historic price surge. Between January 13 and 17, open interest hit nearly $8 billion, and XRP’s price re-entered the $3 range for the first time since 2018. However, bullish momentum faded, leading the price to retrace toward $1.70.
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Now, with XRP approaching the $3 mark again, traders are showing increased speculative interest, anticipating further gains.
Short Positions Dominate Market Sentiment
Despite rising open interest, the XRP long/short ratio over the past 24 hours stands at 0.9109, meaning short positions slightly outnumber long ones. This suggests a cautious outlook, with traders expecting a potential correction.
At the moment, XRP’s price has dipped 3.85% to $2.66, mirroring a 6% drop in open interest to $4.07 billion from its peak of $4.3 billion. The decline follows a broader cautious sentiment in the market, particularly as Bitcoin experiences mild bearish volatility.
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