XRP, on the verge of collapsing below $1... but derivatives open interest is rising

▲ XRP, cryptocurrency decline/AI generated image

XRP fell for the second consecutive day, putting it at risk of breaking below the $1 support level, but derivatives open interest actually increased.

According to crypto-specialized media FXStreet on July 28 (local time), XRP faced selling pressure ahead of the Federal Reserve's (Fed) interest rate decision. The Federal Open Market Committee (FOMC) was expected to keep the benchmark interest rate at 3.50-3.75%. The market priced in a 36% chance of an interest rate hike.

Former Cleveland Fed President Loretta Mester stated, “We need to ask ourselves if the policy stance is appropriate to bring inflation down to 2%,” adding that “Chairman Wash has made it clear that he will not tolerate inflation.” Concerns about interest rate hikes pressured investor sentiment across all risk assets.

According to CoinGlass data, XRP futures open interest increased from 2.22 billion XRP the previous day to 2.25 billion XRP. Binance's XRP holdings decreased from 2.61 billion XRP to 2.6 billion XRP. Compared to the 2.71 billion XRP recorded on June 1, the decline continued. FXStreet explained that the decrease in exchange holdings indicates a reduction in the volume of XRP available for short-term selling.

The price dropped to around $1.05, falling below the Bollinger Bands midline located at $1.10. The 50-day, 100-day, and 200-day exponential moving averages were formed at $1.13, $1.22, and $1.42, respectively. The daily Relative Strength Index (RSI) recorded 39, below the neutral line. The MACD (Moving Average Convergence Divergence) histogram also moved into negative territory.

The short-term support level is the lower Bollinger Band at $1.05. If this price level is broken, the downtrend could continue to the $1 support level. In a rebound scenario, $1.10 and $1.13 were presented as the initial resistance levels. Subsequent resistance levels are $1.22 and $1.42.

[Article Key Summary]

-XRP fell for the second consecutive day, increasing the likelihood of dropping to the $1 support level.

-XRP futures open interest increased from 2.22 billion XRP to 2.25 billion XRP.

-The short-term support level is $1.05, and key resistance levels are $1.10 and $1.13.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*