XRP Soars to $3: Bull Market Signals Emerge in XRP/Bitcoin Wedge
XRP Sees Bullish Momentum Amid Rising Options Activity
XRP, a cryptocurrency primarily used for payments, has experienced a notable increase of over 3.5% in the last 24 hours. This uptick is accompanied by a surge in trading volume within the options market on Deribit, indicating a growing sense of optimism among investors.
Surge in Call Options Trading
Since the beginning of July, there has been a marked interest in higher-strike call options, particularly those set for July 25 at $3.00 and $4.00, as well as a September 28 expiry call at the $2.80 strike. Data from Amberdata highlights these options as the most actively traded in recent weeks.
A call option grants the purchaser the right to buy the underlying asset at a specified price before a predetermined date, reflecting a bullish outlook. For example, buyers of the $3 call option are betting that XRP’s market price will exceed this threshold by July 25. Notably, in the last day alone, approximately 2 million contracts for the $3 strike call have changed hands, predominantly through buy trades, while the $2.80 call has seen more selling activity.
Increased Open Interest and Market Sentiment
The $3 call option has not only gained traction in terms of trading volume but has also seen a significant rise in open interest, which refers to the total number of active contracts. This trend suggests that investor confidence is growing, particularly in light of expectations surrounding a potential spot ETF approval in the U.S. Analysts from Bloomberg have indicated that the likelihood of the U.S. SEC approving a spot XRP ETF is now at 95%, suggesting a strong possibility of this outcome.
In a related development, Ripple, the company behind XRP, has announced its application for a national banking license with the Office of the Comptroller of the Currency (OCC). Ripple’s CEO, Brad Garlinghouse, emphasized that such approval would establish a new standard for trust in the stablecoin sector.
Technical Analysis: XRP/BTC Breakout
The XRP/BTC trading pair has recently broken out of a falling wedge pattern, a technical formation that often signals a bullish reversal. This pattern is characterized by two converging trendlines, indicating that selling pressure is diminishing. The breakout above the upper trendline suggests that the bearish correction from earlier highs has concluded, and XRP may be poised for a renewed upward trend.
Despite this bullish signal, the 50-day and 100-day simple moving averages (SMAs) are currently trending downward, having crossed below the 200-day SMA. However, it is important to note that moving averages are lagging indicators, and the recent breakout takes precedence in determining market direction.
In summary, XRP is witnessing a surge in both price and trading activity, fueled by positive market sentiment and technical indicators. As Ripple seeks regulatory approval, the cryptocurrency’s future appears increasingly promising.
