- XRP’s funding rates have fallen into negative territory, signaling rising bearish sentiment amid the ongoing crypto market correction, with the token possibly testing the $2.17 support level after a recent double-top pattern.
- Despite this, spot traders are buying the dip, and Ripple’s expansion plans, including an XRP ETF, offer some long-term optimism.
The latest market shift has seen XRP’s funding rates take a significant dip, signaling growing caution among investors. As the broader cryptocurrency market experiences a correction, XRP’s outlook appears increasingly bearish, with experts predicting that the remittance-based token could test a critical support level at $2.17.
A Deeper Look at XRP’s Funding Rate Decline
In the past 24 hours, XRP’s funding rate flipped negative, according to Coinglass data, dipping below the stable 0.01% level that had been holding steady. Funding rates are a key indicator for crypto futures traders, representing the periodic payments between traders to keep derivative contracts aligned with the spot price of the asset. Negative funding rates often suggest bearish sentiment, as short traders pay long traders, creating pressure for price declines.
The fall in XRP’s funding rates reflects a broader trend of market pessimism. With XRP funding rates at just 0.03% and open interest remaining elevated, it’s clear that traders are maintaining a wary optimism. While the decline of funding rates could signal a buying opportunity during bullish cycles, the current market outlook remains subdued.
Spot Traders Buying the Dip
Despite this, XRP spot traders appear to be capitalizing on lower prices, with net outflows seen across major exchanges like Binance, OKX, Kraken, and Bybit. Net outflows are often a sign of rising buying pressure, indicating that some traders are actively purchasing XRP during this dip, which could help stabilize the price.
However, as the market continues to face headwinds, XRP’s price may struggle to maintain its momentum. If the token fails to recover above its current levels, the next potential support could be seen near $2.17, particularly after the recent formation of a double-top pattern that often signals an impending downturn.
Will XRP Find Support at $2.17?
XRP’s recent drop saw it breach the $2.33 support level, and technical analysis suggests that the next key support could be around $2.17. If the token tests and fails to hold this level, it could see further declines toward $1.96, potentially triggering a rounding top pattern and pushing XRP to $1.71.
On the other hand, if XRP manages to rally and close a daily candlestick above $2.90, it could invalidate the current bearish thesis, paving the way for a possible recovery.
What’s Next for XRP?
With the market correction in full swing, XRP faces an uncertain short-term future. However, Ripple’s President Monica Long has offered some optimism, mentioning that the firm’s RLUSD stablecoin is set to expand into major exchanges in 2025, and there are even rumors of an XRP ETF following Bitcoin and Ether’s successful ETF launches.
For now, XRP’s funding rates will continue to be closely watched, as they offer valuable insight into the ongoing investor sentiment and the token’s price direction.
