XRP's slight decline over 24 hours, but derivatives market remains strong... $3 challenge at a crossroads

Limitations of Spot Market Rebound Exposure

Ripple(XRP) has pulled back slightly after its recent rally. It is currently trading around $2.43, about 5% lower than the intraday high of $2.57 the previous day. In the short term, there appears to be profit-taking demand, and the overall bearish sentiment sweeping the altcoin market is also believed to be influencing this movement.

The issue is that the duration of this correction in the spot market remains uncertain. Uncertainty in global interest rate trajectories, regulatory risks, and the lack of clear growth catalysts within the industry are factors causing hesitation in new capital inflows at the current level. Among traders, a cautious stance is spreading, with many preferring to “adjust risk first” before aiming for further gains toward $3.00.

Strong Signals from the Derivatives Market

Interestingly, unlike the weak spot market, the derivatives market remains hot. Derivatives here refer to financial products based on underlying assets, such as futures and options. The open interest(OI) in XRP derivatives surged from $3.36 billion on Monday to $4.11 billion on Tuesday.

During the same period, trading volume increased to $10.58 billion, indicating not just position switching but the influx of new leverage funds. Given the high proportion of retail traders in the altcoin market, an increase in open interest signals strengthening short-term accumulation.

The strength in the derivatives market suggests that market participants still believe in short-term upside potential and are prepared for increased volatility. However, for this bullish trend to translate into a genuine trend reversal, open interest and trading volume need to continue expanding. If both indicators turn down simultaneously, the current rebound could be reinterpreted as a simple short-covering and short-term profit-taking rally.

Diverging Technical Indicators

The chart situation is becoming more complex. XRP’s current price is below major moving averages. The 50-day exponential moving average(EMA) is at $2.56, the 200-day EMA at $2.58, and the 100-day EMA at $2.64, all acting as short- and medium-term resistance levels.

Having the price below these moving averages structurally indicates that a strong upward trend cannot yet be confirmed. Meanwhile, the relative strength index(RSI) has declined from 52 on Monday to 48 now, indicating weakening bullish momentum. It remains in a neutral zone but with a negative bias.

Interestingly, the MACD still maintains a buy signal. This suggests some market participants see this correction as a buying opportunity and that risk appetite for assets remains intact.

Overall, the market is in a mixed phase with bullish signals(MACD buy, increasing OI), and bearish signals(price below moving averages, RSI downward), creating an ambiguous situation.

Key Support and Resistance Levels

From an investment perspective, two levels to watch are crucial. First, the upward defense lines at $2.24 and $2.07. These levels previously saw actual buying support during the correction. The $2.24 level was tested once last Sunday, and $2.07 is a confirmed low from early November.

On the upside, breaking through the 50-day and 200-day EMAs at $2.56 and $2.58 would strengthen the bullish scenario. Surpassing these levels would set the psychological resistance at $3.00 as the next target.

Current Critical Phase

The XRP market is currently in a conflicting situation where signals from derivatives and the spot market do not align. While the futures and options markets are seeing influxes of new capital, the spot chart has yet to show a complete trend reversal.

Investors should focus on whether the price can hold above $2.56. Maintaining this level would increase the likelihood of a “rebound” and lay the groundwork for targeting $3.00. Conversely, failure to hold this support could lead to a retest of the $2.24–$2.07 support zone.

Whether the enthusiasm in the derivatives market spills over into the spot market or whether a leverage liquidation triggers a downturn will be key factors determining the future direction.