$80M XRP Shorts At Liquidation Risk If Price Crosses This Level

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In the latter part of 2024, Ripple (XRP) has seen significant interest from investors thanks to its impressive surge by 500%. With this sharp increase, or “parabolic rally” as some might say, numerous traders are betting against it, anticipating a drop in value. However, statistics indicate that positions amounting to approximately $80 million could be forcibly closed if the price surpasses a crucial resistance point.

Ripple (XRP) Shorts’ Liquidation Risk: $80M on the Line

At a critical juncture right now, Ripple (XRP) is exhibiting consolidation patterns on both weekly and monthly charts. Currently trading at $2.335 with a market cap of $134 billion, this token is generating significant user attention. Data from CoinGlass indicates that this increased interest often fuels higher speculation, as approximately $80 million worth of XRP short positions could be liquidated if the price surpasses the $2.40 resistance level. In such a scenario, these short positions would have to be closed at a loss. Breaking down these short positions, Bybit accounts for $8.08 million, OKX for $2.51 million, Binance for $8.42 million, while the remaining short positions come from various well-known cryptocurrency exchanges.

A high potential for significant returns occurs when volatility decreases. Investors frequently hold positions anticipating substantial profits upon a breakout. According to MAXPAIN analysis, XRP seems to be under pressure within a symmetrical triangle configuration, preparing for a surge following the breakout.

$XRP TA

– price squeezed in symmetrical triangle = preapring for breakout

– Bollinger Band Width (BBW) = Approaching local low = breakout imminent

– but symmetrical triangle = no bias = could breakout in any direction

– exaggerate bullish divergence = breakout likely bullish

— MAXPAIN (@Mangyek0) January 10, 2025

A Crash or Rally: What’s Next for XRP?

If the price of XRP rises above $2.40, approximately $80 million worth of short positions will be closed. This usually happens when traders either hit their stop loss or receive a margin call. When these shorts are covered, it leads to increased buying activity, which can potentially cause a significant surge in bullish sentiment and initiate a dramatic upward trend, sometimes referred to as a parabolic rally. However, given the current market conditions, it seems unlikely that this will happen for XRP at this time.

In simpler terms, the four-hour Relative Strength Index (RSI) is currently experiencing a downward trend and having difficulty surpassing the 50 average line. If it does manage to rise above this point, it might lead to a reversal, allowing bearish momentum to gain strength. Such a scenario could potentially signal a decrease in XRP’s price. This prediction appears more plausible given the lower highs that XRP has been producing since December 2024.

Should this scenario materialize, certain potential support points to keep an eye on, according to cryptocurrency experts’ forecasts, include $2.07, $2, and even $1.9.

An earlier forecast by CoinGape had suggested a possible drop in the XRP price to around $1.5, followed by a significant surge.

The previous XRP price prediction by CoinGape indicated that the price could dip down to approximately $1.5 before experiencing a powerful upswing.

Following an upward trend, XRP currently faces a crucial juncture due to recent Ripple developments. If Ripple manages to surpass the hurdle at $2.40, it could lead to the liquidation of approximately $80 million in short positions. Such an occurrence might instigate a surge, potentially causing a breakthrough towards higher prices. In this scenario, $2.90, $3.00, and $3.50 are significant levels to keep an eye on as potential resistance points.

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2025-01-11 11:50