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XRP price eyes a rebound as ETF inflows rise, exchange outflows rise

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XRP’s price remained flat today, March, continuing the consolidation phase that began in February. However, ongoing inflows into exchange-traded funds and declining exchange supply suggest that a rebound may be on the horizon.

Summary

  • XRP price has formed a double-bottom pattern pointing to a strong rebound.
  • The supply of XRP tokens on exchanges has dropped to the lowest level in years.
  • Data shows that spot XRP ETF inflows have continued rising this month.

Ripple (XRP), one of the top cryptocurrencies, was trading at $1.4282 on Thursday, inside a range it has been in the past few weeks. This price is 28% above the year-to-date low of $1.1137.

American investors are still buying XRP ETFs, a sign that they expect it to rebound in the coming weeks. SoSoValue data shows that spot XRP ETFs added $4.2 million in inflows on Wednesday as the crypto market rally restarted. It was the seventh consecutive day of inflows, with the cumulative total rising to $1.26 billion.

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Increased buying by American institutional investors in a time when the price is stuck in a tight range is a sign of accumulation, which often leads to a strong rebound.

Another sign of accumulation is that XRP outflows from exchanges are increasing. Data compiled by CryptoQuant shows that over 7 billion XRP tokens exited exchanges in February. The total amount of XRP tokens in exchanges has dropped to the lowest level in years.

A possible reason why investors are accumulating XRP tokens is its strong fundamentals, including the ongoing Ripple USD growth. The stablecoin has accumulated over $1.5 billion in assets, with its daily volume soaring to over $1.5 billion. 

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RLUSD is benefiting from the rising demand from both retail and institutional investors, a trend that may continue after its integration on Ripple Prime.

XRP price forecast: Technical analysis 

xrp price
Ripple price chart | Source: crypto.news 

The eight-hour chart shows that the XRP price has remained in a narrow range in the past few weeks. 

A closer look shows that it formed a double-bottom pattern at $1.3350 and a neckline at $1.6745. This pattern normally means that short-sellers are largely uncomfortable placing short trades below that level.

The coin has moved slightly above the 50-day Exponential Moving Average. Also, the Percentage Price Oscillator has crossed the zero line, while the Relative Strength Index has jumped above 50.

Therefore, the most likely XRP price forecast is bullish, with the next key target being the neckline at $1.6638. The bullish view will become invalid if it drops below the key support level at $1.3350.

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Crypto World

How Will Markets React to $2.6B Crypto Options Expiring Today?

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Will Huge $8.3B Bitcoin Options Expiry Trigger Another Dump?


The end of another week has arrived, which means more crypto options contracts are expiring as spot markets eye recovery. 

Around 31,700 Bitcoin options contracts will expire on Friday, Mar. 6, with a notional value of roughly $2.2 billion. This event is much smaller than last week’s, so there is unlikely to be any impact on spot markets.

Crypto markets have seen a little daylight this week, with around $150 billion added to total market capitalization since Monday, but things were starting to cool off again by Friday.

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Bitcoin Options Expiry

This week’s batch of Bitcoin options contracts has a put/call ratio of 1.7, meaning that there are more expiring shorts (puts) than longs (calls). Max pain is around $69,000, according to Coinglass, which is a little below current spot prices, so many could be out of the money on expiry.

Open interest (OI), or the value or number of Bitcoin options contracts yet to expire, remains highest at the $60,000 strike price on Deribit as bearish bets remain dominant. Total BTC options OI across all exchanges has been climbing this month and has reached $41.7 billion.

Crypto derivatives provider Greeks Live observed the market rebound, noting that Bitcoin was firmly holding above the $70,000 psychological threshold and is “now poised to challenge $75,000.”

“However, options market data indicate that selling call options has dominated trading over the past two days. Despite ongoing price gains, momentum has slowed.”

In addition to today’s batch of Bitcoin options, around 184,000 Ethereum contracts are also expiring, with a notional value of $380 million, max pain at $1,950, and a put/call ratio of 0.85. Total ETH options OI across all exchanges is around $7.5 billion.

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This brings the total notional value of crypto options expiries to around $2.6 billion.

Spot Market Outlook

Total market cap is down 1.2% on the day to $2.49 trillion; however, it remains at the upper bounds of its month-long sideways channel.

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Bitcoin hit a four-week high of $74,000 on Thursday but was halted there and has pulled back to $70,300 at the time of writing. The asset has seen a strong recovery since the war in Iran started last weekend.

Ether prices stalled at $2,200 and had declined 2% on the day back to $2,065 during the Friday morning Asian trading session. The altcoins were mostly flat on the day and have failed to move in tandem with the top two this week.

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Bitcoin Relief Rally Fades as Bear Market Signals Hold

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Bitcoin Relief Rally Fades as Bear Market Signals Hold

Bitcoin staged a brief relief rally above $74,000 on Thursday, but it has already petered out as analysts predict a persistent bear market will keep momentum subdued. 

“Bitcoin is still in a bear market despite the recent rally,” on-chain analytics company CryptoQuant said on Thursday.

The platform’s Bull Score Index, a composite indicator that measures the overall health of Bitcoin (BTC) using a combination of fundamental and technical metrics, remains at 10 out of 100, “deep in bearish territory,” it said.

“Even after the recent price rally, fundamental and technical indicators still point to a bear market environment,” it stated. 

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“The current move is likely just a relief rally, not the start of a new bull phase.”

Bitcoin briefly tapped a one-month high of $74,000 on Coinbase on Thursday, touching the 50-day exponential moving average, according to TradingView. However, it has already lost more than $3,000, falling back below $71,000 during Friday morning trading. 

The Bull Score Index remains deep in bear territory. Source: CryptoQuant

Bitcoin still vulnerable to renewed downside pressure

Nick Ruck, the director of LVRG Research, told Cointelegraph that the crypto market’s recent relief rally came on “renewed risk appetite and ETF inflows,” but cautioned that the advance has “quickly faced headwinds with prices pulling back toward $71,000 amid persistent macro uncertainties and fading momentum.”

While the brief push provided a welcome relief rally amid supportive liquidity conditions, “ongoing bear market dynamics reinforce caution as softer macro signals, like the anticipated slowdown in February nonfarm payrolls, keep cryptocurrencies vulnerable to renewed downside pressure,” he said.

BTC quickly loses momentum, slipping 4.7% since Thursday’s high. Source: TradingView

Bitcoin could see renewed buying interest

CryptoQuant said that a positive Coinbase Premium has signaled renewed US buying interest, driving the recent rally

Related: Bitcoin slide slowing, but bear market still in play: Analysts

Bitcoin spot demand from US-based investors also switched from contraction to growth, as seen by the Coinbase Bitcoin Premium “switching from deeply negative territory in early February to the most positive since October,” they said.

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Selling pressure from traders and long-term holders has also eased after unrealized losses reached levels not seen since July 2022.

Meanwhile, analysts at SwissBlock observed on Friday that “momentum is flashing a critical shift,” adding “We’re exiting peak negative momentum, the kind of transition that often precedes a regime change.” 

Magazine: Would Bitcoin really be at $200K if not for Jane Street? Trade Secrets