XRP Holds Above $1.29 as Futures Leverage Gets Flushed Out

XRP is trading around $1.30, with the token gaining roughly 1%, while open interest across its derivatives market has dropped sharply. Total open interest has declined from $1.128 billion in August to $871.22 million currently, representing a reduction of more than $250 million in less than a month.

The contrast between a relatively stable spot price and a smaller futures market raises an important question: does the decline indicate weakening bullish sentiment, or is it simply a leverage reset occurring while spot demand remains steady?

Why Lower Open Interest Does Not Yet Signal a Bearish Reversal

Falling open interest generally indicates that traders are closing futures positions, being liquidated or adjusting their exposure before a potential market move. In XRP’s case, the decline does not necessarily point to a bearish shift. It could instead show traders reducing leverage without taking a strong directional position.

Data from individual exchanges supports this interpretation. Binance open interest fell from $558 million to $423 million, while Bybit declined from $379 million to $291 million during the same period. The declines across both platforms suggest a broad reduction in derivatives exposure rather than an isolated move on one exchange.

The positioning and funding data also provide a reason not to interpret the move as outright capitulation. Binance’s open-interest-weighted funding rate remains positive, indicating that long positions still exceed short positions among active contracts. The overall 24-hour long-to-short ratio is 0.9904, suggesting a nearly balanced market, although the figures for larger traders show a different picture.

Account-level data from Binance and OKX indicates that traders remain net long by roughly 2.5 to 3 times. Binance’s top traders are also still positioned net long based on both account numbers and position sizes. Over the past 24 hours, total liquidations reached $9.67 million, including $4.87 million in long positions and $4.80 million in shorts. The nearly even split does not point to a broad, one-directional liquidation event.

The shorter 12-hour period showed a different distribution. Long liquidations reached $500.96K, compared with $148.49K for short positions. That pattern coincided with the period of price weakness before XRP’s latest rebound. While the imbalance is relevant for short-term timing, the broader 24-hour data presents a more balanced picture.

Spot-market demand provides another indication that the derivatives deleveraging may not represent a broader loss of interest in XRP. XRP ETFs attracted $3.5 million on September 16 through Franklin Templeton’s XRPZ fund, extending their inflow streak to 10 consecutive days despite XRP declining during that session.

By comparison, Bitcoin ETFs recorded $295 million in outflows, while Ethereum ETFs experienced $224 million in withdrawals over the same period. That left XRP among the relatively few crypto ETF segments still recording net inflows.

Earlier September data adds further context. A September 7 report showed that Binance’s funding rate had temporarily moved below zero following a wave of liquidations before returning to positive territory reflected in the latest data.

Around the same time, CryptoQuant contributor Amr Taha identified what he called an “unusual structure,” with open interest increasing while perpetual CVD remained persistently negative. The observation highlights how derivatives positioning and taker-driven flows can sometimes move in different directions.

XRP’s current decline in open interest therefore comes after several rapid shifts in leverage during September rather than occurring in isolation.

XRP’s $1.29 Support Could Determine the Next Move

XRP is currently trading near the middle of an 8-hour parallel channel. The range is defined by descending resistance and support lines that have contained the price for several weeks.

On the weekly timeframe, the same area corresponds with two important moving averages. The 50-week EMA sits near $1.52 and acts as resistance, while the 20-week EMA provides support around $1.29.

A daily or weekly close below $1.29 would place XRP below both the 20-week EMA and a key Fibonacci confluence zone. Such a move could bring the psychological $1 level back into focus.

On the other hand, a move above $1.40 would take XRP beyond the descending channel resistance and could open the way toward the $1.60–$1.70 region, which is closer to the 50-week EMA.

The current price structure around $1.30 therefore remains an important area to watch as traders assess whether the recent leverage reset can occur without triggering a deeper decline.

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