The price structure of Ripple (XRP) has been on a downward trend, posting lower highs while sliding over $3.50 towards the $1.50 zone.
As prices weakened, derivatives activity moved in the opposite direction, creating a visible divergence that framed current positioning.
According to Maartun, a crypto analyst, Open Interest (OI) has increased by approximately +12% in the last 24 hours, at the time of publication.
This is not a single spike, but a sustained increase over multiple sessions, particularly during relief rebounds in November and early January.
This rise aligns with increased ETF desk activity and greater coverage flows, suggesting institutional participation alongside directional bets.
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Yet context matters. A rising OI in a falling price generally signals something other than pure accumulation. Instead, it often reflects speculative leverage entering a short exposure or late long positioning attempting dip entries.
Liquidation clusters and sell-off alerts near local tops reinforce that leverage, not one-time demand, drives expansion. As positioning thickens while prices compress, market fragility increases rather than stabilizing.
Leverage expansion during price declines often precedes volatility expansion, rather than an immediate reversal.
Compression of derivatives positioning signals
The XRP derivatives market reveals increasing pressure under price action. Funding rates, which were close to neutral, have recently become slightly negative.
This change shows shorts paying out longs, indicating a growing bearish crowd rather than balanced positioning.
As this develops, OI-weighted funding tightens as price falls from the $3.00 to $1.50 region, reinforcing that expanding leverage is driving the move rather than spot selling.
The Long/Short ratio adds additional context. Seller dominance remains visible at several intervals as takers’ sales volume exceeds buying pressure while price trends decline.
Source: CoinGlass
This alignment reflects a clear directional conviction rather than random market activity. Yet liquidation mapping introduces another layer.
Heatmap scales cluster heavily between $1.35 and $1.45 above, while deeper long liquidations range between $1.18 and $1.22 below.
Source: CoinGlass
This stacked positioning creates two paths of volatility. Negative funding combined with high OI creates short-squeeze potential if price moves toward overhead scales.
On the other hand, failure to rise exposes trapped long positions to cascading liquidations. The market structure therefore remains subject to compressions and not to trends.
Testing $1.15 Support Puts XRP at Risk
XRP is trading in a clear downtrend, forming lower highs while approaching key support.
Price recently tested the $1.15 low, which is the 100% Fibonacci retracement, where short-term buying appeared.
From this level, a slight rebound pushed the price towards $1.29, but momentum remains weak as the broader structure remains bearish.
Source: TradingView
Above, $1.44 marks former support that turned into resistance, reinforced by the 78.6% retracement near $1.39. A daily return above this zone would reduce the downward pressure, allowing the price to pivot towards the 50% level at $1.73.
However, failure to hold $1.15 at the daily close would weaken market sentiment, exposing XRP to a deeper move towards the psychological $1.00 level.
Final Thoughts
- XRP declines as Open Interest increases by +12%, signaling an expansion in leverage and increasing market fragility rather than spot accumulation.
- Bearish overcrowding, negative funding, and dense liquidation scales make prices prone to compression, while $1.15 support remains the breakout trigger.
Disclaimer: The information presented does not constitute financial, investment, business or other advice and represents the opinion of the author only.
