Despite $XRP
price fluctuations in May 2025, options data from Deribit indicates a prevailing bullish sentiment among traders.
📊 Deribit XRP Options: A Snapshot
According to CoinDesk, the $5 call option on Deribit remains the most popular among XRP options, with a notional open interest of $3.84 million—the highest among all XRP strikes on the exchange. However, it's important to note that most of these positions are likely covered calls rather than outright bullish bets. Lin Chen, Deribit's Asia Business Development Head, explained that traders are selling higher-level out-of-the-money calls while holding XRP, allowing them to capture premiums from selling the calls while limiting potential losses from an unexpected market rally.Binance+6CoinDesk+6Reddit+6Reddit+1CoinDesk+1
🔍 Market Sentiment: Bullish Underpinnings
Despite $XRP price slide from $3.40 to $2.40, the $5 call option remains the most favored bet on Deribit, offering significant upside potential for buyers if the price exceeds that level. This sustained interest suggests that traders are positioning for a potential rebound, even as the market shows signs of indecision. CoinDesk+1Reddit+1
📈 Technical Analysis: Bull Flag Formation
Technical analysis of XRP's price chart reveals a bull flag pattern, signaling the possibility of a major breakout. Despite a 10% drop in early December, XRP's price has formed this pattern, which often ind$XRP a pause before a continuation of the previous rally. If this pattern plays out, XRP could rally to the $5 level, supported by increasing activity in $5 strike call options on Deribit. The Block+4utoday.net+4CoinDesk+4
⚠️ Caution Advised
While the options market and technical indicators suggest a bullish outlook, it's crucial to exercise caution. The prevalence of covered calls indicates that many traders are hedging their positions, reflecting a cautious optimism rather than outright bullishness. As always, investors should conduct thorough research and consider market volatility before making investment decisions.Reddit+1CoinDesk+1
In summary, while XRP's price action in May 2025 has been indecisive, the options market data and technical analysis suggest that traders are positioning for a potential bullish move. However, the dominance of covered call strategies indicates a cautious approach, highlighting the importance of careful consideration in the current market environment.