XRP Faces Liquidation Frenzy After April Fools’ Day Crash
The cryptocurrency market is still reeling from a recent brutal price crash, with XRP bearing a significant blow. Coinglass data reveals that $6 million worth of XRP contracts were liquidated in the past 24 hours, primarily due to the sharp decline experienced by XRP on April 1st.
Impact of Bitcoin’s Plunge on XRP
At the start of the new month, XRP was trading at around $0.61. However, Bitcoin’s sudden drop below $67,000 triggered a chain reaction that reverberated across the market, dragging down XRP and other major cryptocurrencies.
- A staggering $5.6 million of the liquidated contracts were long positions, forcing traders who bet on XRP’s price to increase out of their positions.
- In contrast, short positions, which profit from price decreases, only saw a liquidation value of $324,200.
Market Contrasts: XRP’s Uncertain Path
While the liquidation frenzy painted a bleak picture, the spot market revealed a different scenario. XRP’s trading volume surged by almost 60% during the same period, indicating increased activity.
However, a closer look suggests that the surge in volume was driven by selling pressure rather than buying activities, hinting at a bearish outlook for XRP.
This trend of rising volume and falling prices points towards a potential downward momentum for XRP, with analysts predicting a drop towards the $0.55 support level.
Despite these bearish indicators, some analysts hold a more optimistic view, foreseeing a short-term upside for XRP with a price target of $0.74.
XRP Funding Rate Analysis
Analysis of XRP’s Funding Rate reveals that it currently stands at 0.030, slightly higher than the expected rate of 0.029. If the Funding Rate remains positive amid price declines, holders of long positions may not receive the usual funding payments, further fueling bearish sentiments in the market.
Hot Take: The Road Ahead for XRP
As XRP navigates through the aftermath of the liquidation frenzy and price crash, uncertainty looms over its future trajectory. The potential for further downside remains, with a looming threat of being caught in a market downturn. However, conflicting viewpoints suggest a possible short-term rally for XRP, offering a glimpse of hope amidst the prevailing uncertainty.
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