- XRP's uptrend shows signs of faltering, suggesting trader exhaustion and potential profit-taking.
- Ripple enhances investment in the Asia-Pacific region with $5 million in additional funding to support blockchain innovation.
- A 5% increase in the derivatives market's Open Interest and a spike in trading volume to $5.2 billion suggest growing bullish sentiment.
Ripple (XRP) is slowly losing its grip on the uptrend printed on Monday, following last week's sell-off. XRP's price hovers at around $2.27 at the time of writing on Tuesday, down over 2% on the day, as global markets await the aftermath of the ongoing trade talks, now on the second day, between top US and Chinese officials.
Ripple expands investment in the APAC region
Ripple has ramped up investment in the Asia-Pacific (APAC) region, with an additional $5 million in funding through its global University Blockchain Research Initiative (UBRI).
The investment spans six countries, featuring renewed partnerships in South Korea, Japan and Singapore, as well as new grants extended to Taiwan and Australia.
Ripple's increasing focus on the APAC region reflects the progress being made by respective governments to ensure clarity in crypto regulations and support for the development of digital finance.
Meanwhile, UBRI has been making inroads within communities thriving with builders, stakeholders and users by laying the foundation for blockchain innovation in higher education.
As part of the renewed partnerships, Ripple will invest $1.1 million in Korea University over six years. This collaboration builds on an earlier partnership with Yonsei University.
In Japan, Ripple has renewed a partnership with Kyoto University, aiming to advance blockchain research in the country. The partnership entails a $1.5 million grant.
A $3 million funding has been allocated to Nanyang Technological University (NTU), which will extend a partnership with the National University of Singapore (NUS).
"This support allows us to involve more students and researchers in the blockchain ecosystem by enabling them to build on the XRPL and contribute to its growth, thereby advancing our blockchain education initiatives," said Professor Yang Liu, College of Computing & Data Science at NTU.
In addition to the grants, UBRI supports research and development, ensuring that talents in blockchain, cybersecurity and information systems are nurtured. In total, UBRI has invested over $11 million to promote education, adoption, and innovation in blockchain and fintech spaces within the APAC region.
XRP's price upside remains heavy despite the groundbreaking funding announcement, with the technical outlook offering bearish signals. The token is currently trading between support at $2.25 and resistance at $2.32.
Technical outlook: XRP struggles to sustain uptrend amid declining risk appetite
XRP's price is sliding toward confluence support at $2.25, established by the 50-day Exponential Moving Average (EMA) and the 100-day EMA, after facing rejection at around $2.32.
The unsteady uptrend suggests that market sentiment remains strikingly cautious, especially with US-China trade talks in focus.
The Relative Strength Index (RSI) is sideways at the 50 midline, indicating a lack of conviction and confidence in the uptrend. Should the RSI slip below the midline, losses could extend 8% below the current level to test the support provided by the 200-day EMA, which is around $2.08.
A sell signal from the SuperTrend indicator validates XRP's downside vulnerability. This indicator signals traders to consider selling XRP when the price falls below the SuperTrend line, changing its color from red to green.
Traders often utilize this trend-following tool as a dynamic support and resistance. In other words, XRP could uphold the bearish bias as long as the SuperTrend stays above the price.
XRP/USDT daily chart
Meanwhile, the derivatives market has seen a significant increase in Open Interest (OI), rising to $4.34 billion over the last 24 hours, alongside an 11% surge in trading volume to $5.2 billion.
XRP derivatives market stats | Source: CoinGlass
OI refers to the total number of outstanding futures and options contracts that have not been settled or closed. Therefore, an increase in OI alongside the trading volume underlines growing interest in XRP, backed by rising market participation.
If the trend persists, the price of XRP could uphold the short-term support at $2.25, allowing bulls to resolve the technical outlook with a potential 30% breakout to $3.00 from the current price level.
Open Interest, funding rate FAQs
Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.
Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.
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