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XRP price experienced a prolonged correction on Monday, dipping to a low of $0.43 during a widespread market sell-off. This intensified selling pressure was prompted by a 12% drop in Japan’s index after the Bank of Japan decided to raise interest rates to combat inflation. Although the bearish momentum eased during the U.S. trading hours, the XRP faces a 20% downside risk amid an EMA death crossover and a bear cycle within a triangle pattern. 
Also Read: <a href="https://coingape.com/bitcoin-etf-can-see-15-30-gap-down-from-jan-levels-on-monday-says-peter-schiff/">Bitcoin ETFs To See 30% Gap Down From Jan Levels On Monday, Says Peter Schiff</a> 
<h2 id="span-style-font-weight-400-forced-liquidations-and-bearish-funding-rate-exacerbate-sell-off-span">Forced Liquidations and Bearish Funding Rate Exacerbate Sell-Off</h2> 
<a href="https://coingape.com/price/xrp/">XRP price</a> has been on a six-day downward spiral, plummeting from $0.627 to $0.49—a 21.5% decrease. During this period, long position holders faced nearly $30 million in forced liquidations, according to Coinglass data. These liquidations have increased sell orders in the market, intensifying the supply pressure. 
<figure id="attachment_211028" aria-describedby="caption-attachment-211028" style="width: 100%" class="wp-caption aligncenter">
 <img decoding="async" class="size-full wp-image-211028" src="https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-46.png" alt="Total Liquidations Chart" width="1532" height="440" srcset="https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-46.png 1532w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-46-300x86.png 300w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-46-1224x352.png 1224w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-46-768x221.png 768w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-46-150x43.png 150w" sizes="(max-width: 1532px) 100vw, 1532px">
 <figcaption id="caption-attachment-211028" class="wp-caption-text">
 XRP Total Liquidations Chart | Coinglass
 </figcaption>
</figure> 
Moreover, derivative market data for <a href="https://coingape.com/xrp-news-ripple-faces-risk-of-another-sec-lawsuit/">XRP</a> shows an Open Interest (OI)-Weighted Funding Rate of -0.0064. This negative rate suggests that short sellers incur costs to hold their positions, reinforcing a solid bearish outlook and the anticipation of further price drops. 
<figure id="attachment_211029" aria-describedby="caption-attachment-211029" style="width: 100%" class="wp-caption aligncenter">
 <img decoding="async" class="size-full wp-image-211029" src="https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31.png" alt="OI-Weighted Funding Rate" width="1553" height="486" srcset="https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31.png 1553w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31-300x94.png 300w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31-1224x383.png 1224w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31-768x240.png 768w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31-1536x481.png 1536w, https://coingape.com/wp-content/uploads/2024/08/image_2024-08-05_16-29-31-150x47.png 150w" sizes="(max-width: 1553px) 100vw, 1553px">
 <figcaption id="caption-attachment-211029" class="wp-caption-text">
 XRP OI-Weighted Funding Rate
 </figcaption>
</figure> 
Also Read: <a href="https://coingape.com/bitcoin-leads-crypto-outflow-with-400m-lost-amid-recession-fears/">Bitcoin Leads Crypto Outflow With $400M Lost Amid Recession Fears</a> 
<h2 id="span-style-font-weight-400-ema-death-cross-imminent-on-daily-chart-span">EMA Death Cross Imminent on Daily Chart</h2> 
Amid the ongoing correction, the XRP daily chart shows the 50-day Exponential Moving Average is poised to break below the 200-day <a href="https://coingape.com/education/exponential-moving-average-how-to-leverage-it-in-crypto-market/">EMA</a>. This death crossover signals a major signal that could accelerate the current bearish momentum. 
<figure style="width: 100%" class="wp-caption alignnone">
 <img decoding="async" src="https://s3.tradingview.com/snapshots/e/ER82MOfs.png" alt="XRP price" width="1946" height="830">
 <figcaption class="wp-caption-text">
 XRP/USDT 1d Chart
 </figcaption>
</figure> 
Though the flattish 100-and-200-day EMAs signal a sideways trend, the coin price trading below them projects the sellers to have the upper hand. 
<h2 id="span-style-font-weight-400-triangle-pattern-brings-major-support-for-xrp-price-span">Triangle Pattern Brings Major Support For XRP Price</h2> 
The weekly chart reveals that XRP has undergone another bearish reversal within the <a href="https://coingape.com/glossary/symmetrical-triangle-pattern/">symmetrical triangle pattern</a>. This chart setup consists of two converging trendlines leading a sideways trend since September 2021. In theory, the ongoing consolidation should serve as a foundation for the prevailing market trend to gather momentum for a significant move. 
If history repeats, the coin price is poised for another 20% drop to retest the triangle support at $0.4. A fall below this support may lead to a major downfall for this asset. 
<img decoding="async" src="https://s3.tradingview.com/snapshots/y/yBz3Y1om.png" alt="BINANCE:XRPUSDT Chart Image by sahilmahadik07"> 
On the contrary, the lower trendline has remained a strong accumulation zone for crypto buyers since December 2020. If the support holds, the altcoin could rise over 50% to a challenged overhead trendline around $0.61. 
The post <a href="https://coingape.com/markets/3-reasons-why-xrp-price-correction-heading-to-0-4/">Is $0.4 XRP Price Imminent? Insights from Derivative Data</a> appeared first on <a href="https://coingape.com">CoinGape</a>.

Is $0.4 XRP Price Imminent? Insights from Derivative Data

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