A rise in the price and the open interest in XRP has caused it to attract the interest of investors and traders. In the last 24 hours, the price of XRP increased by 5.61%, which is good.
However, what is really significant is the open interest, which reached $3.76 billion.
The increase up to $3.76 billion indicates that traders are more ready to hold positions, either due to the expectation of additional profits or against some possible retreats. In any case, an increase in open interest indicates a rise in confidence.
The increase of the price and the open interest at the same time is important. When price goes up due to temporary buying pressure, it is often seen that the buying pressure is limited solely to a rise in price. But in this case, a corresponding rise in open interest indicates that the market will continue to attract more attention.
You Might Also Like
In a case where there is an upsurge in open interest and at the same time the price has gone up, it is usually an indication of the garnering of momentum. It tends to be a sign that new capital is circulating in the market, and this may increase movements in the price in one direction or the other.
Provided that the bulls prevail, the extra supply of liquidity could support additional gains. Nonetheless, in case of a sentiment change, there can be a massive price fall because of the considerable number of open positions that may be forced to close off fast by traders.
XRP maintains positive trend
The increasing open interest indicates that XRP is a moving and liquid market. Liquidity is significant since it enables a smooth transaction process without having significant price volatility. Notably, the total of $3.76 billion shows that the market for XRP derivatives is sound and growing.
Source: CoinMarketCap
XRP has proved to be a good performer in the last day with an increase of 5.61%, trading at a price of $2.20, according to the latest CoinMarketCap data. The trading volume was $4.27 billion, which represented a minor increment of 0.71% from the previous day.
Having opened at approximately $2.05, XRP faced a series of buying volumes, and each caused the price to move a little bit higher.
Although there are slight pullbacks (as observed in the chart), buyers intervened many times to resist pushes to the downside.
