Key Insights:
- XRP dropped 19% since January 5 as Santiment sentiment moved into extreme fear.
- Coinglass shows XRP Open Interest at $3.38B, keeping leveraged activity high despite losses.
- XRP trades near $1.92 as volume stays strong while small traders step back from risk.
XRP has fallen 19% from its high on January 5. The drop in price has triggered a sharp shift in sentiment. Data from Santiment shows most retail traders are now showing fear across social media.
During the first half of January, XRP traded in what Santiment describes as the “Greed Zone.” The platform flagged multiple Sell Signals between January 7 and 13. As the market turned, sentiment dropped. On January 20 and 21, new Buy Signals appeared, linked to what Santiment calls the “Fear Zone.” The platform noted, “small retail traders have become pessimistic.”
Open Interest Holds Above $3 Billion
According to Coinglass, XRP’s Open Interest is now $3.38 billion. This figure tracks the total value of active contracts in the futures and options markets. While the number has declined from recent highs, it remains well above most of the past year.
Between late November and mid-January, Open Interest climbed fast. XRP’s price also moved higher during that period, reaching levels above $3.00. At its peak, Open Interest ranged between $6 billion and $7 billion. The current level suggests traders are still engaged, even after the price pullback.
Source: CoinglassVolume Steady as Traders Watch the Market
XRP was trading at $1.92 today. The 24-hour trading volume stands at $3.5 billion. Over the past week, the price has dropped by 8.1%, with little change over the last day.
The combination of high Open Interest and a falling price may point to more traders entering short positions. It could also mean some long positions are holding through losses. If prices shift quickly, the number of active contracts could lead to liquidations, making the market move faster in either direction.
Behavior Mirrors Early 2022 Patterns
Analysts have noted similarities between the current trend and early 2022. During that period, retail traders exited after heavy losses, and the market moved higher shortly after. Santiment stated, “prices move the opposite to retails’ expectations more often than not.”
It is not clear yet if that will happen again. Traders are watching closely to see if larger buyers step in. For now, fear is high, and many small players have stepped back.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Source: https://coincu.com/analysis/xrp-slides-193-38b-open-interest/
