Key Highlights
- XRP fell 15% from its March peak of $1.60 to approximately $1.36
- Price currently trades beneath the $1.40 threshold and 100-hour Simple Moving Average
- Open Interest surged from $886 million to $946 million despite falling prices
- Negative OI-weighted funding rate (-0.0086) indicates short position dominance
- Approximately $314 million in shorts clustered between $1.375–$1.405 could create a short squeeze scenario
XRP has faced significant headwinds after losing the $1.40 support level. Following a strong 26% advance between late February and mid-March—climbing from $1.27 on February 28 to reach $1.60 by March 17—the momentum has reversed. The $1.60 level proved to be formidable resistance, triggering a pullback that continues today.
Currently trading near $1.36, XRP has shed approximately 15% from its March high. After touching a recent bottom at $1.3358, the asset has entered a consolidation phase. The price remains positioned below both the 100-hourly Simple Moving Average and the 38.2% Fibonacci retracement level from the latest downward movement.
Technical charts reveal a bearish trend line on the hourly timeframe, placing immediate resistance around $1.3750. Bulls must first overcome $1.3850—corresponding to the 50% Fibonacci retracement—before challenging the critical $1.40 resistance zone.
Rising Open Interest During Price Decline Signals Unusual Activity
The most intriguing development involves Open Interest expanding while prices contract. On March 25, with XRP changing hands at $1.42, total Open Interest measured $886 million. Just one day later, as the price dropped to $1.36, Open Interest had jumped to $946 million. Current figures show a slight pullback to roughly $933 million.
CryptoQuant analyst JA Maartunn highlighted this price-OI divergence, describing the configuration as potentially “juicy” while recommending traders exercise caution.
The OI-weighted funding rate has fallen into negative territory at -0.0086. When funding rates turn negative, it signals that traders are compensating to maintain short positions, validating that bearish sentiment currently prevails.
Conditions Ripe for Potential Short Squeeze
Coinglass liquidation heat maps reveal approximately $70 million in short positions concentrated at $1.375, with an additional $44.98 million clustered near $1.3785. Altogether, around $314 million worth of short positions sit packed between $1.375 and $1.405.
Should XRP rally into this concentrated zone, liquidation-driven buying could create upward momentum cascade. This phenomenon represents a classic short squeeze setup.
Traders face two distinct scenarios. The first involves XRP remaining suppressed below $1.37, allowing bears to maintain control and potentially pushing prices toward $1.3350 or $1.3220. A breakdown below these levels would expose $1.30 as the next major support.
The alternative scenario sees XRP breaking into the $1.375–$1.405 liquidation cluster, sparking cascading short closures. Such a development could propel prices swiftly toward $1.4120 and potentially higher.
As of this writing, XRP hovers around $1.36, maintaining position above the $1.35 support threshold, while Open Interest stands at approximately $933 million.
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