Ripple (XRP) Price Analysis: Traders Lean Bullish Ahead of SEC’s Oct.7 Appeal Deadline

Ripple (XRP) Price Analysis:

XRP price fell to $0.57 on Oct 2, marking a sharp 14.5% decline in the last three days, as geopolitical tensions escalated in the Middle East.

Despite these market uncertainties, bullish traders have maintained a strong presence in the XRPUSD derivatives market, suggesting optimism about a near-term recovery.

XRP Price Sinks Below $0.60 Amid Middle-East FUD

Ripple (XRP) had been enjoying a significant price rally in the last week of September, buoyed by a variety of positive factors.

Among the key drivers were the U.S. Federal Reserve’s 50 basis points rate cut and the early release of Binance CEO Changpeng Zhao from prison, which lifted XRP to a six-month high of $0.66 on September 28.

However, this upward momentum was short-lived. As geopolitical tensions in the Middle East flared up, global markets—including the crypto space—were hit by waves of uncertainty. By October 2, XRP had plunged to $0.57, reflecting a steep 14.55% drop over the past three days, largely due to fears surrounding potential macroeconomic impacts stemming from the crisis.

At the time of writing, XRP is trading just below $0.58 as traders evaluate the risks posed by the increasingly volatile geopolitical situation.

XRP Traders Maintain Bullish Outlook Despite Market Correction

Despite the sharp 14.55% correction in XRP’s price over the past few days, a closer examination of market sentiment reveals that many traders are still leaning bullish. In particular, XRP’s derivatives markets show that many long positions remain open, a sign that speculative traders expect a quick rebound.

One metric that highlights this sentiment is the Funding Rate, a key measure in the derivatives market that indicates the balance of sentiment between long and short positions. A positive funding rate suggests that long traders are paying a premium to keep their positions open, signaling confidence in a price recovery.

As of October 2, the XRP funding rate stands at 0.00016%, according to Coinglass data. This positive funding rate persists despite the asset’s ongoing price dip, signaling that many speculative traders are betting on an imminent price rebound.

Positive Funding Rate Amid 14.55% Dip: A Bullish Signal?

The fact that XRP’s funding rate remains positive despite the ongoing correction is an important indicator of trader sentiment.

Typically, when an asset is in a downtrend, funding rates can turn negative as short traders gain the upper hand. However, in XRP’s case, the positive funding rate signals that the majority of traders are still bullish, likely expecting an early recovery.

This could set the stage for a bounce back above $0.60 in the coming days, as traders are seemingly pricing in a resolution to the current market uncertainties.

Additionally, the geopolitical tension in the Middle East, while a source of fear for global markets, may not have as prolonged an impact on the crypto space, where volatility is often met with sharp rebounds.

Traders Showing Optimism as SEC’s Oct. 7 Appeal Deadline Approaches

Adding to the bullish sentiment in the XRP market is the looming deadline for the U.S. Securities and Exchange Commission’s (SEC) appeal in the ongoing case against Ripple.

The SEC has until October 7 to file an appeal, and many market participants are anticipating that either no appeal will be filed or that the outcome could be more favorable for Ripple than originally expected.

This anticipation may help explain why XRP’s funding rate remains positive despite the recent price dip. Many traders appear to be positioning themselves for a potential price spike, should the SEC either fail to file an appeal or the court’s decision tilt in Ripple’s favor.

The closer we get to the October 7 deadline without news of an appeal, the more likely it seems that speculative traders will double down on their bullish positions, adding fuel to a potential breakout.

For now, all eyes remain on the SEC as traders brace for a pivotal moment that could significantly impact XRP’s short-term price trajectory.

XRP Price Forecast: Early $0.60 on the Cards?

Given the current state of the market, XRP looks poised for a recovery, though risks remain.  XRP price dipping below the vital $0.60 psychological support level on Oct 2, underscores major bearish risks.

However, with positive funding rates and the upcoming SEC deadline, a quick rebound appears likely.

If XRP can reclaim the $0.60 level, the next major resistance would be around $0.63, which coincides with the upper Bollinger Band on the daily chart. This level has served as resistance during XRP’s recent upswing, and a breakout above it could open the door to a retest of the $0.66 high from late September.

However, it’s important to note that the geopolitical risks from the Middle East crisis could continue to weigh on global markets, including cryptocurrencies. Should the situation worsen, XRP could face increased downward pressure, with the next major support level sitting around $0.55.