XRP Extends Rally as Derivatives Metrics Support Bullish Outlook

XRP has extended its gains, increasing by more than 6% during the previous session. This rally is supported by improving long-to-short ratios and positive funding rates in derivatives trading.

Data from CoinGlass shows that long positions currently outnumber shorts for both XRP and other cryptocurrencies, with a long-to-short ratio of 1.15 on Tuesday.

The funding rate has also turned positive, reaching 0.0079% on Tuesday, which generally reflects stronger demand for bullish exposure.

However, CryptoQuant's market indicators highlight several risks, including signs of overheating in the spot and futures markets, as well as sell-side dominance in futures activity.

The signals suggest that XRP's rally retains bullish momentum but may be entering a more fragile phase, with a growing retail demand and institutional interest in XRP products also contributing to the price increase.