XRP Derivatives Data Turns Neutral as Price Nears a Possible Bottom
XRP remains under pressure. Still, its derivatives market is no longer as bearish as it was. CryptoQuant analyst Pelinay points to four Binance indicators showing that selling has eased and trader positioning has shifted closer to neutral. My take: that change matters, but the wider downtrend is still intact.
Traders hunting for a bottom may find some comfort here. The chart remains ugly. Derivatives sellers, however, no longer have a firm grip on the market. Does that make a recovery inevitable? No. XRP could be moving into consolidation, and a recovery remains possible, but the data confirms neither outcome yet. After months of falling prices, though, neutral feels like progress.
Pelinay first looks at the balance between long and short liquidations on Binance. Long liquidations total about 103,000 XRP, while short liquidations are roughly 122,000 XRP. The gap is small. Bullish and bearish traders are taking similar losses. Far higher long liquidations would mean heavy selling was driving bullish positions out of the market; a sudden jump in short liquidations would instead point to forceful buying and perhaps a short squeeze. Neither is happening. Bulls and bears look evenly matched for now, a clear change after XRP’s earlier selling pressure. I would read that as balance—not hidden strength.
The second indicator is a funding rate near zero. Traders are not paying much extra to keep long or short positions open, so neither side has become crowded. The liquidation figures tell the same story: conviction is thin. Most market commentary treats calm funding as bullish. That is only half right. When funding rates stretch too far in one direction, overextended traders can unwind and push the market the other way; XRP has no such setup at the moment. Trading has become calmer. Price is going nowhere.
Pelinay’s third point is that the similar liquidation totals suggest balanced leverage. Price swings are hurting traders on both sides instead of repeatedly punishing bulls or bears. That makes XRP a miserable trade for anyone using heavy leverage. A quick rise wipes out shorts. Then the reversal catches longs. Everyone gets chopped up. I’ll be honest: I see indecision here, not strength hiding beneath the surface. This pattern can drag on until news or a convincing price move gives traders a reason to pick a side.
The fourth sign is the low chance of an immediate squeeze in either direction. Near-zero funding suggests traders are neither overly optimistic nor rushing to bet on more losses. Combined with the liquidation numbers, it describes a market that has not committed even though XRP remains weak. Why does that matter? Because volatility could stay muted while traders wait for clearer direction. Counter to the usual advice, quiet positioning is not automatically a setup for an explosive move. If positioning eventually becomes lopsided, however, the odds of a violent breakout will rise.
The spot chart offers less comfort. As of July 20, XRP trades at $1.08, close to the bottom of its short-term support area. Buyers need to defend $1.08 to $1.10 to keep the recovery attempt alive. The daily chart has been trending down since July 2025, and XRP now sits more than 70% below the $3.60 cycle high from the summer of 2025. It dropped to about $1.008 on June 26, its lowest level in 19 months and the hardest test of $1.00 since November 2024. In my view, those figures outweigh the calmer tone in derivatives. The price is still in a bad spot.
The moving averages are just as grim. XRP’s 50-day simple moving average is $1.12, compared with $1.25 for the 100-day SMA and $1.42 for the 200-day SMA. All three now act as resistance. XRP must recover them before a sustained rally looks believable. Buyers have held the $1.00 to $1.06 area so far, absorbing the recent selling without surrendering the psychological $1 level. A daily close below $1.00 could bring $0.90 to $0.93 into play; if that support breaks, $0.80 is next. On a rebound, XRP must first reclaim $1.13, which has flipped from support to resistance. Another barrier waits at $1.15 to $1.20, where the 50-day exponential moving average runs into Fibonacci resistance. One bounce has plenty to fix.
What it means
XRP’s neutral derivatives positioning could be an early sign of a turn, but it does not mean the downtrend is over. The harshest selling may be fading. Balanced liquidations and near-zero funding often appear when traders stop leaning hard in one direction and sit on their hands. Yes, that sounds cautiously bullish. It isn’t—not yet. XRP could consolidate or attract buyers. It could also fall again. These numbers cannot tell us which comes next; they show only that sellers have surrendered some of their previous edge.
The wider market gets a vote too. Federal Reserve decisions on inflation and interest rates still affect demand for riskier assets. If money starts flowing back into crypto, XRP’s calmer derivatives setup may help it join the move. Bitcoin and Ether will probably drive that move more than XRP does, though. I would not treat positioning in one altcoin as a signal for the entire market. That leap is too easy.
For now, price levels are more useful than sweeping forecasts. Bulls need to hold $1.08 to $1.10. Losing $1.00 would be a serious blow, exposing $0.90 to $0.93 on a sustained move below that level, with $0.80 potentially following. Reclaiming $1.13 would make the chart look a little healthier. Is that enough to call a reversal? Not by itself. A break above $1.15 to $1.20 would provide firmer evidence that the calmer derivatives market is beginning to carry over into spot trading.
Funding rates and liquidations remain worth watching. A sudden change in funding—or a growing gap between long and short liquidations—would mean traders are choosing a direction again. Until then, the setup is awkward: neutral derivatives, bearish price chart. I would keep those two signals separate. The next few weeks may reveal whether XRP is building a base or simply catching its breath before another round of selling.