XRP Price Drops 4.8% to $2.35 Amidst Heavy Selling Pressure from the Bears

XRP price has dropped 4.8% in the last 24 hours to $2.35 amid heavy selling pressure from the bears as bulls fail to take it past the $2.50 resistance

Key Notes

XRP price dropped 4.8% in the last 24 hours to $2.35 amid heavy selling pressure from the bears as bulls failed to take it past the $2.50 resistance despite the Ripple lawsuit clearance this week. The daily selling volume is up by 15%, which shows that the selling pressure from the bulls is high.

A combination of fundamental and technical factors seems to be behind today’s XRP price drop. This includes failure to ride despite Ripple dropping the cross appeal against US SEC, a bearish technical setup, as well as a lack of enthusiasm among traders.

On-chain Metrics Show Weakness for XRP Price

As the XRP price heads downwards, on-chain metrics also show weakness for the Ripple cryptocurrency. According to Coinglass data, the XRP futures open interest dropped by 4.21% today while slipping under $3.9 billion.

The open interest (OI) currently stands at $3.9 billion, marking a 50% drop from its January 18 peak of $7.8 billion. This decline in OI indicates reduced capital inflows into the market, potentially intensifying price drops as buying pressure lessens. Plus, the 24-hour liquidations have shot past $10.41 million, of which $9.87 million is in long liquidations.

On the other hand, the funding rate for the XRP perpetual futures market turned negative earlier today on March 27, dropping from 0.0088% to -0.0049%.

Negative funding rates occur when shorts (bets against the price) compensate longs to maintain their positions, reflecting bearish market sentiment. Without sufficient buyer intervention, this dynamic can lead to additional selling pressure, driving prices even lower.

Will XRP Drop Under $2?

As XRP price comes under the bearish grip, analysts are closely observing whether it can further lead to another 15% correction to its next critical support at $2.

Renowned crypto analyst Ali Martinez highlighted the importance of maintaining this level, signaling its significance in determining the token’s future price trajectory. If XRP loses the $2 support, it can crash all the way further to $1.2 levels.

$2 remains the most critical support level for $XRP!

If this level breaks, the next logical support lies around $1.2.

A drop below $2 would generate substantial selling pressure, potentially leading to a steeper decline.

Keep an eye on this crucial support zone.

— Ali Martinez (@ali_martinez_) March 27, 2024

However, other market analysts have not lost hope and believe that this is just a momentary pullback before the Ripple cryptocurrency resumes its journey to fresh all-time highs, to $10 and beyond.

Crypto analyst Dark Defender highlighted a bullish outlook for XRP, citing the formation of a “Bullish Rectangle Pattern.” According to the analyst, this consolidation phase is nearing its end, paving the way for a potential breakout. Dark Defender expressed optimism that the next price movement could propel XRP to new all-time highs.

Hi all, $XRP formed a great Bullish Rectangle Pattern.This consolidation will be over very soon.The next leg will welcome new all-time highs.Tick Tock!Have an excellent day!