After several months of extreme volatility that has caused futures traders across the crypto derivatives market to trade with caution, it appears that traders are becoming more active in XRP futures again.
Latest data from crypto analytics platform CryptoQuant shows that XRP leverage trading on Binance is rising following the recent rebound in its price.
XRP OI spikes to 440.6 million tokens
The data further revealed that the 30-day Open Interest Z-Score for XRP futures has surged to about 1.60 on Binance. This suggests that open interest is now well above its average over the past month.
Moreover, XRP open interest on the exchange has surged to about 440.6 million XRP, while its 30-day moving average has also surged to 418.5 million XRP, as XRP continues to trade near $1.14.
The increase in Binance XRP derivative activity suggests that more traders are opening new futures positions amid growing confidence and optimism over XRP's next price move.
While this provides a bullish outlook for XRP, analysts note that the surge in futures activity does not guarantee a price rally. However, it shows that market participants are becoming more confident in opening new leveraged positions after a long period of extreme caution.
When will the XRP price break out?
It is important to note that XRP spot activity has yet to mimic the renewed optimism seen in the futures market, causing its price to remain at local low levels.
Market analysts believe that the divergence between XRP rising open interest and a stable price move could mean that the market is building up for a larger price move.
As such, if the price of XRP increases in correspondence with its rising open interest, this could trigger a strengthening bullish conviction among traders, leading to sustained buying momentum that could drive the price toward a major breakout.
Dan Burgin
U.Today Editorial Team
