XRP Funding Rate Climbs Amid Crypto Market Drop

XRP funding rate is drawing attention as its value increases despite a general downturn in the crypto market. While most digital assets are experiencing moderate losses, XRP’s futures contracts tell a different story — signaling potential bullish sentiment among traders.

The cryptocurrency market kicked off Sunday with a wave of selling, affecting many major coins, including XRP. The crypto derivatives space saw approximately $138 million in liquidations over the past 24 hours, with short positions contributing roughly $90 million of that figure. Despite this downturn, XRP maintained a positive funding rate according to CoinGlass, hinting at possible growing interest from buyers.

A positive funding rate typically suggests that most traders are betting on price increases, leading to a stronger demand for long positions. Those holding long positions pay a premium to short traders, as the perpetual contract price trends above the spot price. In XRP’s case, this market activity reflects expectations of upward momentum despite an overall bearish environment.

The current funding rate for XRP/USD on Binance is calculated at 0.0031%. At the time of assessment, XRP had dipped 1.25% over the past day to settle at $2.06. However, the presence of a positive funding rate highlights market optimism that could precede stronger price action.

Source: TradingView

XRP Consolidates with Potential for Breakout

While XRP faces short-term selling activity, analysts note signs of potential breakout behavior. The token declined to a recent low of $2.03 on April 16. Since then, it has formed a tight trading band between $2.03 and $2.12 over five sessions. Traders are now monitoring this narrowing zone, hoping to identify which direction the next significant move might take.

Interestingly, volume related to XRP fell by 19% in the same timeframe to $1.39 billion. This type of volume contraction is often typical prior to volatile price shifts. As a result, the current period of tight consolidation could act as a precursor to a sharp movement either upward or downward, depending on broader market cues and resistance or support level reactions.

Technical indicators suggest that a rebound effort could be brewing. Bulls have so far defended the crucial $2 support mark, which implies sellers lack conviction at lower levels. If upward momentum builds, XRP may aim for the 50-day simple moving average (SMA), currently hovering around $2.23. A clean break above this zone may provide room for a further rally.

On the other hand, if XRP fails to maintain the $2 level, bears may regain control. Dropping below this support could open the door for deeper declines, potentially targeting the $1.72 to $1.61 support range.

The next few sessions are likely to be critical for XRP traders. Whether the tightening range leads to a bullish surge or further downside, market participants should watch funding rates, volume shifts, and support zones for clues on the token’s next direction.

Related: Expert Advice: Sell XRP If You’re Confused

In a market filled with uncertainty, XRP’s current dynamics set it apart as one to watch — with its surging funding rate signaling that a major price move may be just around the corner.