The XRP (XRP-USD) market went through a dramatic reset this week as futures open interest plummeted more than 50% in just a few days. According to data from CoinGlass, XRP’s open interest dropped from $8.36 billion on October 10 to roughly $4.22 billion by October 14, marking one of the steepest declines in months.
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The sharp fall reflects a major reduction in leveraged trading positions and growing caution among speculators. Binance, the largest platform for XRP derivatives, saw its open interest tumble from $1.3 billion to $607 million over the same period, a 53% decline.
Market data suggests that traders rapidly unwound positions following the weekend crash that sent XRP tumbling from $2.40 to below $0.80 before rebounding above $1.50. The latest drop in open interest indicates that the ongoing rally may now be driven more by spot buying than leveraged speculation.
Traders Focus on the $2.65 Resistance Level
While leveraged traders have pulled back, market analysts remain cautiously optimistic about XRP’s technical circumstances. On Tuesday, crypto analyst Matthew Dixon, CEO of Evai, shared an updated chart showing that XRP has completed a major corrective pattern and could be preparing for a new move higher.
“XRP so far has failed to break back above the $2.65 resistance level but it should just be a matter of time. If we can break and retest that level then rapidly higher towards new ATH should follow the large WXY correction down that now appear complete,” Dixon said in a post on X.
His chart shows XRP rebounding sharply after completing what he identified as a large WXY correction pattern, which is a structure that often marks the end of a downtrend. The move suggests that XRP may be stabilizing and positioning for its next leg higher, provided it can clear the $2.65 barrier convincingly.
Sentiment Turns Cautious but Structure Holds
The plunge in open interest indicates that much of the speculative excess has been flushed out of the market. In turn, this has reduced the risk of another liquidation-driven drop and left room for organic price growth.
At the same time, the reduction in leveraged exposure has made XRP’s price action more dependent on spot market flows. Analysts say this could create a healthier foundation for a longer-term rally if buying momentum continues above support.
For now, traders are waiting to see if XRP can sustain a breakout above $2.65. A successful retest of that level could open the path toward Dixon’s projected target of new all-time highs, while failure to hold above support may signal further consolidation ahead.
Key Takeaway
After one of the most volatile weekends for XRP in months, the market appears to be recalibrating. The collapse in open interest suggests leverage has been cleared from the system, while price action shows signs of recovery.
As Dixon put it, XRP’s resistance test may only be “a matter of time.” Whether that breakout comes soon could determine if the recent rebound becomes the start of a sustained trend higher. However, it could also mean another pause in the long consolidation that traders are still trying to shake off.
At the time of writing, XRP is sitting at $2.4966.
