XRP recovers but weak derivatives data limits bullish conviction

Key takeaways

• XRP’s long-to-short ratio has reached a bullish 1.06, even as funding rates slip into negative territory.
• The cryptocurrency is holding support above its 50-day EMA of $1.284 and 100-day EMA of $1.255.
• Securing a daily close above the 200-day EMA at $1.353 could pave the way for a move toward $1.90.

XRP continued its upward correction on Thursday, bouncing off crucial technical support thresholds. Despite these gains, a mix of conflicting funding rates, long-to-short ratios, and on-chain metrics suggest market participants are still hesitant to call a definitive trend reversal. Trading around $1.30, XRP managed to stay above both its 50-day and 100-day exponential moving averages (EMAs), though it still needs to break and close above the 200-day EMA at $1.353 to solidify its recovery.

Mixed Signals Among XRP Derivatives Traders

Data from CoinGlass shows XRP’s long-to-short ratio climbed to 1.06 on Thursday, nearing a one-month high. Because a ratio above 1.0 indicates that long contracts outnumber short positions, this metric points to a slightly bullish sentiment among market participants.

However, funding rates paint a more complex picture. XRP’s funding rate flipped negative on Wednesday and remained at -0.0040% on Thursday. A negative rate means short sellers are paying premiums to long holders, which typically reflects growing bearish aggression. This discrepancy between a high long-to-short ratio and negative funding rates underscores the split opinions among futures traders.

Analysts at CryptoQuant also suggest caution across both spot and derivatives markets. Their indicators show that while XRP displays signs of being overheated, the futures market is experiencing sell-side dominance. Furthermore, rising participation from retail investors could trigger sharp price swings if leveraged trades get overcrowded. Ultimately, these on-chain and derivatives metrics indicate that XRP still lacks the steady buying pressure required to confirm a lasting recovery.

XRP Defends Critical Support Between $1.25 and $1.28

On Thursday, XRP hovered near $1.30, preserving its neutral, range-bound price action. The asset remains positioned just above its 50-day EMA ($1.284) and 100-day EMA ($1.255), establishing a key demand block between $1.25 and $1.28.

The Relative Strength Index (RSI) sits around 46, pointing to flat-to-bearish momentum, while the Moving Average Convergence Divergence (MACD) remains in negative territory, confirming that buying momentum has not fully returned. Should XRP fail to hold this cluster of moving averages, a drop toward the psychological support level at $1.00 could be on the horizon.

On the upside, the 200-day EMA at $1.353 stands as the primary obstacle for bulls. Overcoming this resistance on a daily closing basis would significantly brighten the technical landscape, potentially clearing the way for a rally toward major horizontal resistance at $1.90. Conversely, if XRP fails to push past $1.353, it will likely remain stuck in its consolidation phase, leaving the $1.30 level exposed to further downside pressure.