On Wednesday, Judge Analisa Torres ruled that Ripple Labs must pay a civil penalty of $125 million and barred the company from future violations of securities regulations. This marked the end of the protracted battle between the SEC and Ripple and sent the XRP price climbing towards new monthly highs. However, in the past few hours, the XRP price is facing a correction as several indicators have turned bearish following selling pressure near highs.
XRP’s open interest drops by 10%
Over the past few hours, the price of XRP has seen a significant decline, driven by a strong selling presence near the recent monthly high of $0.64. According to Coinglass, there has been an increase in long position liquidations, with total liquidations reaching $1.3 million. Buyers have liquidated approximately $1.2 million worth of positions over the past four hours.
Also Read: Ripple Price Prediction 2024 – 2025: Will Fall Completion Push XRP to $1?
Previously, Judge Torres ruled in July 2023 that while selling XRP to institutions violated securities laws, transactions to the general public through cryptocurrency exchanges were legal. This week, the judge resolved the conflict between the SEC and Ripple by imposing a $125 million penalty on Ripple.
Although this decision initially sparked a bullish trend for XRP, the altcoin struggled to maintain buyers’ interest. This boosted sellers’ confidence and led to a decline in buyers’ control over XRP prices. Data suggests a significant decline in XRP’s open interest, which fell by almost 11% to $456 million. Lower open interest along with a falling price could pose a robust resistance and negate the chances of a potential recovery.
The transaction volume has dropped sharply, falling by more than 65% to below $5 billion. Despite this, the prevailing sentiment points to a possible bullish recovery in the XRP price, fueled by a significant increase in the long-short ratio. Currently, the ratio stands at 1.181, with 54% of the positions being long, indicating an imminent rise in the XRP price.
What’s next for the XRP price?
XRP climbed above the moving averages and touched the overhead resistance at $0.64, reflecting strong buying interest from the bulls. However, the bulls could not sustain the momentum as selling dominance increased near this level. This pushed the price below the 23.6% Fib channel, resulting in a retest of the XRP price. At the time of writing, the XRP price is trading at $0.58 and is down over 7.2% in the last 24 hours.
Although the bears are attempting to sink the price below $0.57, the bulls maintain a slight lead by keeping the price around the 20-day EMA ($0.59). If the price rebounds from its current position, the chances of a move above $0.64 increase, which would potentially push the XRP/USDT pair towards $0.74.
Conversely, if the price turns down and closes below the 20-day EMA, it could indicate that the pair may continue to fluctuate between $0.43 and $0.64 for some time.
