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The first days of 2024 ushered in not only a new year but a classic roller coaster ride on the crypto market, with XRP taking center stage as it demonstrated resilience against bearish sentiment. According to CoinGlass, in the last 24 hours, the crypto market witnessed a staggering $161 million worth of positions being liquidated, with 81.8% of them being short positions.
Meanwhile, XRP emerged as a standout performer, with short positions worth over half a million dollars getting liquidated – a whopping 13.57 times more than long positions. Despite this relentless bearish pressure, the XRP price managed to post modest 2.14% growth, currently trading at $0.634 per token and staying within the range established in early November.
Prevailing sentiment among market participants toward XRP is overwhelmingly bearish, a trend that is evidently reflected in trading strategies.
However, the real puzzle lies in deciphering whether the primary driver is the price movement itself or the liquidation of short positions. It appears that a combination of substantial leverage and inadequate risk management is resulting in widespread liquidations triggered by even minor upward movements.
What comes first?
The market's current behavior prompts a critical question – is the upward movement of XRP the cause or consequence of the capitulation of bearish traders? Some analysts suggest that the liquidation of shorts might be acting as fuel for the price growth of XRP, turning the tables in favor of the bulls.
The battle between bulls and bears in the XRP arena remains intense, making it a focal point for investors and traders navigating the unpredictable waves of the crypto market.
Tomiwabold Olajide
Yuri Molchan
Arman Shirinyan
