Investors are increasingly betting on a price breakout for the XRP token. Could XRP see more upward momentum?
Traders Increasingly Betting on XRP Price Rising
More traders are betting on a rise in the price of XRP (XRP), which is reflected in a surge in open interest (OI), according to market analysis by verified CryptoQuant author Minkyu Woo.
He wrote in a June 18 research paper:
“This trend suggests that investors are opening more positions in anticipation of an increase in the price of XRP, as open interest is rising along with the price. This high interest indicates that more trading activity is occurring in XRP.”
However, the authors warned that this could also lead to increased price volatility. He wrote:
“If open interest increases along with the price, it may reflect investor expectations and behavior, but caution is needed as it may lead to sudden market volatility.”
According to Binance data, the price of XRP has fallen more than 19% year-to-date (YTD) and is trading at around $0.49.
XRP’s open interest began to rise on June 11, and expectations of a breakout may be related to the development of Ripple’s lawsuit against the Securities and Exchange Commission (SEC).
On June 13, Ripple cited the SEC’s settlement with Terraform Labs, asking for a fine of “no more than $10 million,” much lower than the $876.3 million civil penalty proposed by regulators.
In a letter to Judge Torres a day later, on June 14, the SEC argued that “such low fines would not meet the purposes of the Civil Penalties Act.”
The potential settlement would come as a sign of relief to investors, considering the two have been fighting a legal battle since 2020 when the SEC alleged Ripple sold unregistered securities.
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Is the price of XRP heading for a breakout?
The XRP token is expected to see a price breakout by the end of June based on key technical chart configurations.
On the daily chart, XRP has formed a descending triangle, a chart pattern that can signal a potential price breakout as the triangle’s wedge narrows. If it can hold above the $0.47 support, it could trigger a rise in XRP price.
The XRP fractal also hints at a potential breakout as long as the price chart repeats a pattern seen since February 2024, when XRP price broke out of a similar ascending triangle pattern.
Fractal patterns are used by technical traders to identify key support and resistance levels and potential trend reversals based on historical data.
At the same time, traders should consider potential negative news related to the SEC vs. Ripple lawsuit, which could hit the market and potentially push the XRP price below its current support level.
Related: Bitcoin price ‘cluster’ hints at more downside. Is BTC About to Lose $64,000 Support?
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.