Quick take:
The funding rate on XRP perpetual contracts across all major exchanges has been negative since around the 8th of December. The chart below courtesy of Bybt.com, further demonstrates this fact.
The screenshot below courtesy of Bybt.com further shows the individual funding rate values of XRP futures contracts on the various crypto exchanges. From the screenshot, it can be observed that XRP’s funding is as low as -0.5% on Binance for the token margined contract. It is also at -0.4% on the regular USD margined XRP perpetual contract on Binance.
As earlier mentioned, XRP’s negative funding rates on its perpetual contracts have prevailed since around the 8th of December and could be setting up the remittance coin for a short squeeze. This hypothesis was first highlighted by the team at Bybt via the following statement on Twitter
.#xrp crazy funding rate.Short squeeze imminent.
A short squeeze is defined as when the price of an asset in the markets experienced a sharp increment and short-sellers are forced to close their positions in order to prevent more losses. This creates a scenario of intense buying that accelerates the price increment.
In the case of XRP, the remittance coin has managed to hold the $0.54 price area in the last 24 hours and ahead of the Flare Networks snapshot
that occurs at 00:00 UTC. In the event of a short squeeze, XRP could instantaneously revisit resistance zones at $0.60, $0.63, $0.65, $0.68 or even $0.72.However, XRP is still in the midst of a massive correction that could ultimately lead to a retest of the $0.50 support zone. According to crypto analyst MagicPoopCannon, XRP could go as low as $0.45.
At a minimum, I’m looking for price to retrace to the 0.44-0.45 level, which corresponds to the 61.8% retrace, as well as the 16% retrace of the 2015 bear market, which I’ve identified as an extremely important level in previous analyses.