XRP Tops $2 Amid Bearish Trend and Short Squeeze Risk
Key Takeaways
The price of Ripple (XRP) recently broke through a key trendline and surpassed the psychologically important level of 2 US dollars. Despite this development, the overall trend remains bearish. Technical indicators and market analysis point to an impending price correction. A short-term increase up to 2.25 US dollars could trigger a so-called short squeeze before the price declines again. Traders should proceed with caution and avoid prematurely betting on rising prices.
Trendline Break Is Not a Buy Signal
Since early March, XRP has been in a downtrend, characterized by a descending trendline. This trendline has now been broken, which appears bullish in the short term. The conversion of the 2-dollar mark from resistance to support also suggests stabilization. However, the broader chart picture remains negative. The last significant high at 2.23 US dollars has not yet been surpassed. As long as that remains the case, the downtrend remains intact.
Technical Indicators Show Mixed Signals
The RSI (Relative Strength Index) is at 54, indicating slight positive momentum. A value above 50 generally signals rising prices. At the same time, the OBV (On-Balance Volume) continues to show declining volume values. This suggests a lack of buying interest in the market. As long as the OBV does not reach a new high, caution is advised. Traders should avoid premature long positions.
Resistance Between 2.23 and 2.70 US Dollars
The Fibonacci retracement analysis shows several resistance zones. The first relevant area lies at 2.23 US dollars, followed by stronger barriers at 2.46 and 2.70 US dollars. These zones could represent potential turning points for the price. A breakout above these levels would be necessary to end the downtrend sustainably.
Derivatives Market Indicates Possible Short Squeeze
In the last 24 hours, open interest (OI) — the total volume of open derivative positions — has increased by 6%. At the same time, spot trading volume (CVD – Cumulative Volume Delta) remained unchanged. This indicates that the price increase was not driven by real buying pressure in the spot market. Rather, the rise was likely caused by leveraged positions in the derivatives market. This imbalance could lead to a short squeeze in the short term — a situation where short sellers are forced to close their positions, temporarily pushing the price higher.
Liquidation Data Reinforces Warning Signals
A look at the liquidation heatmap reveals a cluster of highly leveraged short positions just above the current market price, particularly up to the 2.25 US dollar level. These positions could be liquidated in the coming hours, potentially resulting in a short-term price increase. However, a renewed downward movement is expected afterward.
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Our Assessment
Although XRP has risen above 2 US dollars in the short term, the medium-term trend remains negative. The trendline break and the increase in open interest suggest a possible short squeeze that could drive the price up to around 2.25 US dollars. A correction is expected to follow. Those trading XRP should look for clear signals and not be misled by short-term movements. The area between 2.23 and 2.70 US dollars is particularly critical. Significant resistance levels in this range will determine the future price development.
| Symbol | XRP |
| Coin type | Alt Coin |
| Transaction Speed | High |
| Pros |
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| Cons |
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| Further practical applications | |
| Price | $2.20 |
| 24h % | 2.66 % |
| 7d % | 5.97 % |
| 30d % | -10.86 % |
| 60d % | -11.01 % |
| 1y % | 318.15 % |
| Official Links | Website |
| Socials | X |
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