XRP appears to be gathering significant momentum, exhibiting strong on-chain demand and favorable market conditions that could position it for a substantial price breakout. With critical market dynamics aligning, many are watching closely for its next move.
Bolstering On-Chain Strength and Supply Squeeze
XRP's recent rebound is largely underpinned by robust on-chain demand. Binance exchange reserves have notably decreased, with nearly 100 million XRP withdrawn since October 10th, reaching early September levels. This decline in available supply, coupled with accumulating bullish sentiment, is creating a classic setup for a potential supply squeeze. Furthermore, Futures Open Interest has seen a significant $5 billion dump, indicating light leverage in the market. This reduction in speculative positions is often seen as a healthy precursor for a sustained price rally driven by spot demand rather than overleveraged positions.
ETF Catalysts and Key Breakout Levels
The timing of these market shifts couldn't be more opportune, as XRP Spot ETF hearings are imminent, with Grayscale's hearing scheduled for October 18th. This event is widely anticipated to provide a significant seasonal tailwind for XRP, building investor conviction that has already led to inflows for 18 consecutive weeks, totaling $61.6 million even after recent sell-offs. While XRP has already demonstrated impressive recovery, bouncing 100% from its $1.25 low to surpass $2.50, the critical test for a sustained breakout lies at the $3.20 mark. If this level holds amidst the ETF catalysts, it could serve as the trigger for a substantial upward price trajectory.
