XRP Price Action May Be Healthier Than Bitcoin’s – Here’s Why

XRP's price action has caught some eyes lately, as it's not following Bitcoin's usual patterns.

Cryptocurrency prices have been moving in interesting ways lately, especially comparing Bitcoin (CRYPTO: BTC) to another major coin, XRP (CRYPTO: XRP). As Bitcoin has pulled back somewhat, traders are discussing what could come next.

What Happened: According to crypto analyst Cryptoinsightuk, the funding rate for XRP is still in negative territory, even though the price of the token has been able to move up. This means that more traders are betting against the cryptocurrency, using leveraged short positions.

“Interestingly $XRP's funding rate is negative throughout this move up, suggesting that more people are leverage short right now than long;This contrasts $BTC OI as funding on $BTC is positive meaning more people are long than short.Meaning $XRP's price action could be healthier as it's moving up without traders getting overly long and inflating the market with leveraged longs. Also, note how the market structure on $XRP is more sustainable than $BTC. We're seeing clear higher lows and highs on lower time frames on $XRP compared to $BTC which is struggling to form any structure at all. This could be due to the narrative that Bitcoin maximalists are shorting altcoins or perhaps due to some other factor but it's interesting to observe nonetheless.”

The funding rate for Bitcoin is currently in positive territory, which means that more traders are going long on the token than shorting it.

Related Link: How A Bitcoin Futures Funding Rate Works And Why It Matters

Why It's Important: This setup could lead to a short squeeze on XRP, where those who are betting on the price to go down will have to start buying the token to cover their positions. This buying pressure could push the price of XRP even higher.

On-chain analyst Ali also noted that large investors purchased over 90 million XRP in 72 hours.

"This aligns with previous reports indicating that whales have accumulated more than $1 billion worth of XRP in a short period of time. The data suggests increasing institutional and large-scale investor interest in the asset."

This whale action also comes ahead of the White House crypto conference on March 7, where industry leaders and legislators will convene to discuss digital asset regulations.

Several analysts believe that this event could have a significant impact on the adoption and market trajectory of cryptocurrencies.

"Major transactions on-chain are showing great buying activity from large investors. Looks like they've purchased over 90M $XRP in the last 72 hours. Interesting times indeed. #XRP " on-chain analyst noted.

According to technical analyst Dark Defender, XRP recently broke a key 4-hour resistance level and the RSI has formed a Golden Cross, a bullish signal indicating potential for further gains.

"We'll want to see a break above 3.3999 to confirm continuation of the uptrend. Support at 2.22 and Fib 0.786. Strong resistance levels lie at 3.3999 and 5.85."

XRP Price Action: XRP is trading at $2.56 at the time of writing. Over the past day and week, the token has moved up around 1%.