Payments-focused cryptocurrency .
The cryptocurrency’s price has risen 50% to seven-year highs above $3 this month, extending last quarter’s 240% rally, according to data source CoinDesk. Prices have gained 30% in the last seven days alone, raising the market capitalization to $176.75 billion, the third highest ahead of stablecoin Tether.
XRP is witnessing the fastest rally seen since the altcoin boom of January 2018, according to a popular market analysis tool called the relative strength index (RSI). The measure ranges from 0 to 100 and measures the speed and change of price movement over specific periods, typically 14 days or 12 months.
XRP’s 14-month RSI has risen to 92, the highest level since October 2017, indicating that the momentum seen over the past 12 months is the strongest in seven years.
Novice traders would be quick to point out that RSI readings above 70 indicate overbought conditions and potential for a bullish respite or correction. However, that is not necessarily the case, as the RSI simply measures the speed of price changes over a specific period.
Indicators may continue to show the so-called overbought reading for longer than the bears can remain solvent. As the law of motion says: an object in motion will remain in motion unless acted on by an external force.
“Cryptocurrencies continue to recover from Monday’s drop, with BTC moving towards the $100,000 mark. The broader market is recovering, with altcoins like XRP and XLM standing out. XRP has regained third place among cryptocurrencies and surpassed capitalization BlackRock market leader,” Diego Cárdenas, OTC trader at digital asset platform Abra, said in a note to CoinDesk.
“This rise is driven by a growing number of partnerships, the launch of Ripple’s RLUSD stablecoin, and speculation about a possible XRP spot ETF,” Cárdenas added.
Currently, XRP-specific factors combined with broader crypto market dynamics support the current bullish momentum.
Take trading volumes as an example. The spot market total has tripled to over $23 billion in the last 24 hours, validating the price increase. Meanwhile, derivatives volumes have more than doubled to $34 billion, according to data source Coingecko and Coinglass.
XRP perpetual futures open interest has risen to a record 2.34 billion XRP, with funding rates accounting for the cost of holding leveraged bets hovering around 13%. That’s well below the overheated 100% in early December, which signaled excess bullish leverage. In other words, the XRP market is much healthier and supports continued price growth.
Meanwhile, crypto market leader bitcoin has surpassed $100,000, encouraging the slowdown in US core inflation. Bitcoin’s strength often translates into greater risk-taking in the broader crypto market.
