XRP has lost about 6% of its value in the past week as the sell-off wave intensifies across the crypto market.
Although the surge to an all-time high (ATH) of $3.66 during the July market boom brought profits to many holders, increasing volatility is starting to test investor sentiment. So what does this mean for holders?
XRP traders cling to profits despite losses
According to data from Glassnode, the net unrealized profit/loss (NUPL) indicator of XRP shows that the market is currently in the belief – denial zone, where investors still hold unrealized profits despite increasing losses.
The NUPL indicator measures the difference between unrealized profits (when holders are still in the profit zone) and unrealized losses (when positions fall into loss).
According to the on-chain data provider, the belief – denial zone reflects a transitional phase in market sentiment. In the belief phase, investors are confident, most positions are profitable, and optimism predominates. Meanwhile, in the denial phase, prices begin to decline but holders refuse to acknowledge the downward trend, still hoping for a bounce back.
With XRP's NUPL falling into this zone and the token having decreased by 11% in the past week, holder confidence is beginning to waver. Nevertheless, many still cling to hope, denying the possibility of deeper declines.
XRP futures show an upward bias despite price pressure
The Long/Short ratio of XRP is rising, reflecting optimism among futures traders as they continue to bet on price recovery despite recent losses.
According to data from CoinGlass, this ratio is currently at a 30-day high of 1.05, indicating that the number of traders opening Long positions exceeds those opening Short positions.
The Long/Short ratio tracks the balance between traders betting on price increases (Long) and those betting on price decreases (Short). When this ratio is above 1, it indicates that Long positions dominate, reflecting bullish sentiment. Conversely, a ratio below 1 indicates that Short positions dominate, implying bearish expectations.
The high ratio of XRP means that traders still hold hope for a recovery, even as market volatility and selling pressure continue to increase.
XRP at a decisive threshold
At the time of writing, XRP is trading around $2.84. If bullish bets continue to rise and market sentiment gradually shifts to positive, the token could reach $3.22.
Conversely, if the sell-off wave continues and downward pressure increases, XRP may continue to decline and approach the $2.637 level.
