XRP extended its recovery on Thursday, trading above $1.32 after breaking above the upper boundary of a falling channel pattern. This technical development, combined with improving derivatives sentiment, suggests that selling pressure may be easing, though significant resistance levels remain ahead.
Data from CoinGlass shows that funding rates for XRP turned positive on October 30 and have remained positive, currently standing at 0.0103%. Positive funding rates indicate that traders holding long positions are paying those with short positions, reflecting increased demand for leveraged bullish exposure in the perpetual futures market.
However, the broader derivatives picture is mixed. The long-to-short ratio for XRP was 0.97 on Thursday, a reading below 1 indicating that short positions still outnumber long positions. This suggests that bearish sentiment has not fully dissipated, which could cap upside momentum if selling pressure intensifies near key resistance levels.
Technical Breakout and Resistance Levels
On the daily chart, XRP has moved above the upper trendline of a falling channel, a breakout that often signals weakening bearish momentum and growing buyer interest. Yet, the cryptocurrency continues to trade below its major exponential moving averages (EMAs), which are clustered overhead.
The 100-day EMA sits at $1.323, followed by the 50-day EMA at $1.335 and the 200-day EMA at $1.378. These levels represent formidable resistance, and a sustained recovery would require XRP to reclaim these moving averages. A daily close above the 100-day EMA could encourage buyers to target the 50-day EMA, while a move above the 200-day EMA would significantly improve the technical outlook.
Momentum Indicators Show Improvement
Momentum indicators are also showing signs of improvement. The Relative Strength Index (RSI) stands at 51, above the neutral 50 level, indicating that bearish momentum is fading. Meanwhile, the Moving Average Convergence Divergence (MACD) has registered a positive crossover, with its main line moving above zero, suggesting short-term momentum is turning bullish.
These indicators support the possibility of additional upside, but confirmation is still pending. The concentration of moving averages above the current price means that any rally could face selling pressure before a more sustained uptrend develops.
Key Levels to Watch
Immediate support is located around $1.265, corresponding to the previously broken upper boundary of the falling channel. A successful retest of this level would reinforce the bullish breakout structure. However, a daily close below $1.265 would weaken the recovery outlook and could trigger renewed selling, with the next downside targets at $1.160 and the psychological $1.000 level.
On the upside, the first significant resistance is the 100-day EMA at $1.323. A breakout above this level could open the door to the 50-day EMA at $1.335 and then the 200-day EMA at $1.378. If XRP reclaims all three moving averages, attention could shift to horizontal resistance at $1.540 and $1.900.
While the positive funding rates and technical breakout are encouraging, the mixed derivatives positioning and overhead resistance suggest that the recovery is not yet fully confirmed. Traders will be watching whether XRP can sustain its gains and overcome these hurdles in the coming sessions.
This article is for informational purposes only and does not constitute financial advice.
