Data shows that XRP is Currently modeling Interesting on-chain behavior amid broader market uncertainty. This unusual behavior was highlighted by CryptoQuant, an on-chain cryptocurrency analytics company. The strange behavior is noteworthy because it is associated with an increased open interest in XRP in comparison To other cryptocurrenciesWhich indicates that XRP is poised for a significant price movement.
Rising open interest for XRP
According to CryptoQuant data I noticed at first By an analyst connected to the analytics platform, Latest news involving The Securities and Exchange Commission (SEC) and Ripple, the parent company of XRP, have seen open interest in XRP resuming the uptrend.
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According to the CryptoQuant chart below, open interest, which has generally been in an uptrend since April 15, recently took a hit in the first week of June and began to decline in conjunction with the decline in the price of XRP. However, open interest has now recovered and resumed its upward trend.
Interestingly, this increase is more significant than that of other cryptocurrencies, considering that many crypto prices faced difficulties in the past week. Rising open interest also conveys the current sentiment among XRP investors, as it indicates that investors are opening more positions in anticipation of an increase in the price of XRP.
How will this affect the price?
Express interest Indicates the total number of outstanding derivative contracts that have not been settled. Rising open interest often indicates more money flowing into the market. This is evident in the chart above, where increases in open interest were mostly recorded with a corresponding increase in the price of XRP.
Furthermore, open interest is a leading indicator for many smart investors. When it rises, it indicates that new money is flowing into the market as traders open new positions. This increased activity and liquidity can foretell where the price of an asset may go next. No matter which direction the price goes, one outcome is almost guaranteed: more volatility.
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At the time of writing, XRP is trading at $0.486 and has risen by 1.44% in the past seven days. Despite this small increase, it is interesting to note that XRP is currently the only asset among the top 20 cryptocurrencies still in the green zone last week. Add to Bullish outlook It is strong trading volume over the past few days.
According to data from Santiment, some traders remain bullish on XRP despite the fact that it is currently outperforming many other assets. XRP is also short selling to counter the bulls. But as Santiment notedThis is a good sign for patient bulls, as short selling activity can be “rocket fuel” for them Prices continue to rise When they are eventually liquidated.
Featured image created with Dall.E, chart from Tradingview.com