- XRP remains below $2 as a sharp drop in derivatives open interest signals a broad leverage reset rather than panic selling.
- Price now consolidates near key support, with direction dependent on whether demand returns above resistance.
XRP continues to trade below the $2.00 level as the market enters a prolonged cooling phase marked by thinning participation and limited conviction. After a strong rally earlier in the cycle, price action has slowed sharply, with recent rebounds failing to attract sustained follow-through. The current setup reflects a market weighed down by caution, as traders wait for clearer signals before re-engaging.
While spot demand has not collapsed, derivatives data shows a decisive reset unfolding beneath the surface. According to analyst Darkfost, the shift began when XRP open interest on Binance surged to an all-time high of $1.76 billion on July 17. That spike created highly crowded positioning, leaving the market vulnerable as volatility increased and prices stalled.
XRP Open Interest Collapse Signals a Major Deleveraging Phase
As leverage unwound, XRP experienced a steep correction, falling from $3.55 to $1.83, nearly a 50% drawdown. This decline closely mirrored the contraction in derivatives positioning, underscoring how tightly price action had become linked to leverage during the distribution phase.
Since then, Binance XRP open interest has dropped below $500 million and remained suppressed following the October 10 liquidation event. Overall, open interest is now down nearly 60% from its peak, reflecting widespread closure of leveraged positions rather than a sudden loss of spot demand. Part of this decline also stems from XRP’s lower price, which reduces the notional value of outstanding contracts, though the magnitude suggests a genuine reduction in speculative activity.
Historically, such deleveraging phases play a stabilizing role. They remove excess leverage, lower forced-selling risk, and reduce short-term trader dominance. XRP open interest now sits below its semi-annual average, a condition that has often preceded periods of structural repair in past cycles.
XRP Price Holds Key Support as Volume Remains Muted
At the time of writing, XRP is hovering around $1.89, just below the $2.00 psychological threshold. This zone has repeatedly acted as short-term support in recent months. However, declining moving averages continue to compress prices, reinforcing ongoing downside pressure.
The 50-period moving average slopes downward and acts as resistance near the $2.30–$2.40 area, while the 100-period average strengthens this barrier. Meanwhile, the 200-period moving average has flattened near $1.85–$1.90, forming a critical structural support zone. A decisive break below this level could expose XRP to deeper downside toward the $1.60–$1.70 range.
Trading volume remains subdued, pointing to market apathy rather than panic selling. For recovery to take shape, XRP must reclaim $2.00 and hold above the 50-period average. Until then, price action suggests continued consolidation as the market searches for its next direction.
ALSO READ: IOTA Launches Blue Ocean Strategy for Real-World Tokenization
DISCLAIMER:
The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of the publisher. The publisher does not endorse or guarantee the accuracy of any information presented in this article. Readers are encouraged to conduct further research and consult additional sources before making any decisions based on the content provided.
About the Author
