Ripple Price Forecast: XRP bulls defend $1.50 as exchange reserves decline

XRP regains momentum on Tuesday and reclaims the $1.50 support level.
Binance Exchange Reserves shrink to 2.69 billion XRP, suggesting increasing transfers to self-custody wallets.
XRP upholds a stable technical structure, supported by rising moving averages and the SuperTrend indicator.

Ripple (XRP) shows signs of stabilizing after reclaiming support at $1.50 on Tuesday. A robust technical structure underpins the token’s short to medium-term bullish outlook. Still, XRP is not out of the woods yet, as profit-taking and buyer exhaustion could weigh on price action and extend the recent correction from September highs around $1.66.

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XRP stabilizes on cooling exchange reserves

The amount of XRP on Binance exchange has shrunk in the last few days to 2.69 billion XRP as of Monday, down from 2.7 billion XRP last Saturday. Despite the pullback, the current level still sits above mid-August lows, suggesting that supply remains elevated on Binance.

XRP Binance Exchange Reserves | Source: CryptoQuant

Falling exchange reserves as XRP gradually gains momentum indicates cooling selling pressure in the open market, as supply trickles into self-custody wallets. Investors transfer their digital assets to self-custody wallets intending to hold longer. If supply continues to shrink, the path of least resistance may remain upward, raising the odds of gains toward September highs at $1.66 and August highs at $1.70.

Nevertheless, traders should temper expectations, as perpetual futures Open Interest (OI) in the derivatives market eased to 3.5 billion XRP on Tuesday, from 3.7 billion XRP the day before. More broadly, OI has softened from the 3.8 billion XRP recorded on September 23.

Technical analysis: XRP bulls tighten grip

XRP trades at $1.51, extending its advance well above the key Exponential Moving Averages (EMAs). Price holds firmly over the 50-day EMA at $1.37, the 200-day EMA at $1.37 and the 100-day EMA at $1.31, while the SuperTrend line at $1.28 reinforces a constructive underlying structure.

Momentum remains supportive, with the Relative Strength Index (RSI) hovering near 58 and the Moving Average Convergence Divergence (MACD) indicator marginally positive, suggesting buyers retain near-term control despite the latest upswing.

On the downside, initial support lies at the 200-day EMA at $1.37, closely backed by the 50-day EMA at $1.37, forming a nearby demand cluster should a corrective pullback unfold. Deeper support emerges at the 100-day EMA at $1.32, while the SuperTrend baseline at $1.28 marks a more distant structural floor that would need to hold to preserve the broader bullish bias.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Open Interest, funding rate FAQs

How does Open Interest affect cryptocurrency prices?

Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.

How does Funding rates affect cryptocurrency prices?

Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.

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