XRP’s Uncertain May Amidst Optimistic Outlook – A Critical Observation
XRP, utilized by Ripple for international transactions, concluded May with indications of market uncertainty. Nevertheless, trading activity on the leading crypto options platform, Deribit, suggests that optimistic investors are not yielding just yet.
Key Points:
- XRP’s performance in May showcased market indecision, represented by a doji candlestick pattern indicating potential bullish exhaustion.
- Despite this, positive sentiment lingers on Deribit, where open interest remains substantial in higher-strike call options.
- XRP’s function in global payments and hopes for a U.S. ETF listing are contributing to this bullish outlook.
The cryptocurrency formed a doji candlestick pattern in May, signifying hesitation in market direction, as per insights from TradingView. The long upper shadow indicates that while buyers attempted to drive prices up to $2.65, sellers intervened, pulling prices back to their beginning-of-month levels.
In the previous week, several traders opted for $2.40 strike put options set to expire on May 30, providing a safeguard against price drops.
Bullish Options Open Interest
Looking overall, the sentiment remains upbeat, with open interest in options heavily favoring higher-strike call options. Open interest denotes the total number of outstanding contracts at any moment. The call option gives buyers a potential upside exposure to XRP, suggesting a bullish position.
According to Luuk Strijers, CEO of Deribit, “XRP open interest is steadily increasing, with the highest concentration sitting between $2.60 and $3.00+, indicating a keenly optimistic outlook even while the spot price trades at $2.16.”
To summarize, while XRP’s market behavior suggests periods of indecision, indicators reflect a robust bullish attitude amongst traders driven by XRP’s role in cross-border payments and growing expectations of a spot XRP ETF launch in the U.S. Furthermore, Ripple aims to tackle inefficiencies in SWIFT-based payments, with prospects leading the market to project a substantial leap in the B2B cross-border payments arena by 2031.
