Analyst Suggests Surging XRP Spot Volumes Signal Upcoming Parabolic Price Rally

XRP’s recent surge in spot market volumes indicates a potential parabolic price rally, according to market analysts. The cryptocurrency experienced a sharp 16% price increase following news that Ripple’s legal battle with the U.S. Securities and Exchange Commission (SEC) might soon conclude. However, XRP has since retraced, losing half of its gains and falling below the critical $2.50 level.

Spot Market Activity Drives XRP Rally

Historically, XRP reached its all-time high of $3.40 on January 16, driven by strong spot buying volumes. Analysts now observe similar market conditions emerging again. Data from Velo shows the aggregated spot tape cumulative volume delta (CVD) indicator has turned positive for the first time since late January, signaling increased buying pressure.

The aggregated spot tape CVD measures the net difference between aggressive buy and sell trades across multiple exchanges. A positive reading indicates buyer dominance, potentially fueling further price increases.

Futures Market Remains Bearish

Despite bullish spot market signals, the futures market remains cautious. The aggregated premium on open interest is negative, indicating futures traders are betting against XRP’s price rise. This creates a tug-of-war scenario between bullish spot traders and bearish futures traders.

Technical Outlook: Potential Retest Before New Highs

Crypto analyst CrediBULL Crypto suggests XRP could retest lower support levels around $1.80 to $2 before rallying to new all-time highs above $3.40. According to the analyst, XRP is currently in an accumulation phase, which may be followed by a brief manipulation period targeting downside liquidity.

Market analyst Dom highlights the importance of XRP stabilizing around the $2.50 level, noting that the volume-weighted average price (VWAP) at XRP’s all-time high remains a bullish threshold.

Key Technical Levels to Watch

• A bullish close above $2.65 could signal a positive break of structure, encouraging futures traders to adopt a bullish stance.
• A close below $2.23 would invalidate recent bullish momentum and reinforce bearish sentiment.
• Maintaining support above the ascending trendline is crucial for XRP to sustain its upward trajectory.

Quick Summary and Key Points

• XRP surged 16% following positive news on Ripple’s SEC lawsuit but retraced below $2.50.
• Spot market volumes indicate strong buying pressure, potentially signaling a parabolic rally.
• Futures markets remain bearish, creating uncertainty in short-term price direction.
• Analysts suggest XRP may retest lower levels around $2 before rallying to new highs.
• Critical technical levels to watch include $2.65 (bullish breakout) and $2.23 (bearish invalidation).

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.