XRP fell by almost 10% last week, weakening traders' sentiment and triggering selling activity in the futures market.
As buying pressure decreases, this altcoin risks falling below the key support level of $2 in the short term.
XRP Futures Traders Prepare for Decline
The bearish atmosphere in the XRP market is evident in the token's taker buy/sell ratio, which has consistently recorded negative values over the past two weeks.
This indicates that sell orders dominate buy orders in the XRP futures market. At the time of reporting, this ratio is 0.92, according to Cryptoquant.
The asset's taker buy-sell ratio measures the ratio of buy and sell trading volumes in the futures market. A value above 1 indicates that buy trading volume is higher than sell volume, while a value below 1 suggests that more futures traders are selling their held assets.
The continuous decline of XRP's taker buy/sell ratio over the past few weeks indicates that many futures traders are increasing their short positions.
This is reflected in the token's Longing/Short ratio, which is currently 0.94.
Notably, this indicator has remained below 1 since May 8th, emphasizing that traders have been anticipating a downward movement for almost a month.
The persistent demand for short positions suggests that XRP's price decline is not a reaction to short-term volatility. It also shows a broader bearish trend increasingly driven by expectations of lower prices.
Will XRP Maintain the $2 Support Level?
At the time of reporting, XRP is trading at $2.13. If bearish pressure intensifies, this token risks falling below the psychological $2 level. If this key support line breaks, the ongoing correction could deepen, causing XRP to trade below $1.99.
However, this bearish outlook could be invalidated if new demand for the altcoin increases. If buying surges, the XRP token could experience an upward correction and rise to $2.29.
