XRP’s price went up 40% at a surprise rally, find out why

The price of XRP rose 40% in a single day, with settlements on the futures markets reaching US$73.5 million.

XRP’s price rose 40% in a surprise rally, find out why MARKET ANALYSIS

The price of XRP has increased 40% in the last 24 hours, registering a 52% gain at the peak of the day. Behind the surprising recovery was a large price squeeze that caused enormous volatility BitQT review within hours.

It is clear that the increase was driven by a small tightening in futures exchanges due to the speed of the hike.

One hour XRP/USD (Coinbase) chart. Source: TradingView.com
The XRP took about four hours to increase from $0.2536 to $0.3120. Since then, it has dropped to about $0.3550 at major exchanges, including Binance.

What triggered the big squeeze in selling the XRP?

On December 23, when the entire market corrected, the XRP had the largest number of settlements, surpassing Bitcoin (BTC) and Ether (ETH).

Liquidations occur in the futures market when the price of the asset suffers a large price movement and a long (buy) or short (sell) position is overbid.

For example, if a trader uses 10x leverage, he can trade an amount that is 10 times greater than the base capital. But if the asset price moves against the position by 10%, the position is completely liquidated.

In the case of XRP, a squeeze occurred after the U.S. Securities and Exchange Commission filed a complaint against Ripple and two of his executives.

The over-selling of XRP followed with the price of XRP falling to $0.2138. But as the market swung sharply to short positions, little pressure occurred on December 25.

As a result, the XRP price rose rapidly in four hours. In the last 24 hours, data from Bybt.com shows that $73.5 million in XRP futures contracts have been settled.

XRP Liquidations. Source: Bybt.com
Some technical analysts predicted squeeze in XRP’s sales, identifying the trend of excessive sales. An analyst with a pseudonym known as „Crypto ISO“ said:

„XRP is likely to increase. Is it wise to short-sell something after such a big drop with the news already out? I’m not sure that the box is high and I really wouldn’t touch it, but I wouldn’t try to milk much more in a sold position either. The exclusion of Coinbase could be the final blow if that happens. ”
XRP remains at risk of capital closure in US
Analysts remain divided on the short to medium term future of XRP. Some say that even if the XRP is considered a title in the US, it is used globally and as such the case of the SEC alone would not mean the end of the XRP.

A trader with a pseudonym known as „Credible Crypto“ said that XRP is not a security in Singapore, Japan and some other jurisdictions. He wrote:

„90% of Ripples‘ clients are not in the US. Over 90% of XRP’s trading volume occurs on exchanges outside the US. XRP is NOT a bond in Singapore, UK, Switzerland and Japan. If you think the SEC case is sending $ XRP to $ 0, you may not be thinking objectively. $ XRP is global. ”

However, the process will probably still have a major impact on the token as Ripple is a US-based company and the supply of XRP is managed by US citizens. Consequently, „Neko,“ a cryptomaniac investor, said it is still a big problem. He said:

„That’s true about the volume. But you are also forgetting that the XRP administrators are U.S. citizens and so is the corporation. If the SEC sees it as a title, the exchanges that interact with US customers will have to be taken off the list. I wouldn’t say it’s a 0, but it’s still a big problem. ”