Everyone was betting on a decline... XRP, signal that created a 126% rally detected again

▲ XRP/AI-generated image

While XRP has shown a relatively sluggish performance among major large-cap cryptocurrencies, signals pointing to a potential reversal have been detected in the derivatives market. The XRP funding rate on Binance has maintained a bearish bias for an extended period, and some analysts have suggested that this excessive short position bias is similar to patterns observed just before past major rallies.

BeInCrypto reported on May 10 (local time) that XRP gained only 5.7% over the past month, underperforming most of the top 5 largest assets, excluding stablecoins. Compared to some assets like Zcash (ZEC), Toncoin (TON), Ondo (ONDO), and Internet Computer (ICP), which showed stronger gains during the same period, XRP's rebound was limited.

However, on-chain analyst Darkfost observed significant internal changes in the market. He explained that after the Total3 index (excluding Bitcoin (BTC), Ethereum (ETH), and stablecoins) decreased by over $544 billion since early February, it has recovered approximately $125 billion. Despite some market rebound, traders are still leaning towards short positions, according to his analysis.

Notably, the XRP funding rate on Binance has maintained a bearish bias for nearly three months. BeInCrypto stated that this is the longest bearish bias period in recent history. Darkfost highlighted that the bearish bias in funding rates persisted even as XRP's price increased by 27% during the same period. He analyzed that potential reversal signals often appear when such strong market consensus forms after a correction exceeding 60%.

Past cases were also mentioned. Darkfost explained that a similar trend occurred in April 2025 when XRP reached $1.25, which was followed by a bullish recovery, leading to a 126% increase. This time, the fact that the price is holding up despite the market being overly skewed in one direction is considered a factor that fuels expectations for a reversal.

Opinions are divided from a technical perspective. One analyst saw XRP's movement as similar to Toncoin and Ondo, which showed strong breakouts after a bearish consolidation phase. He argued that XRP's next move is preparing to target $2 to $4. In contrast, another market observer analyzed that XRP is trapped within a symmetrical triangle. This pattern indicates that the market is consolidating and has not determined a direction, and it does not inherently predict an upward or downward movement.

The XRP price is currently approaching the apex of the symmetrical triangle. BeInCrypto reported that the possibility of a decisive trend reversal could increase towards the end of May. A breakout above the upper resistance could lead to strong upward momentum, but conversely, a breakdown below the lower boundary could attract additional selling pressure. XRP's next move depends on whether buying pressure can break through the triangle's resistance line amidst the short-biased funding rates.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*