BitMEX revealed that it will be rolling out a new financial product for XRP. Despite the significance of the announcement, several technical indicators estimate that this cryptocurrency could lose some of the gains made over the past few days. 

On Jan. 23, BitMEX, a cryptocurrency derivatives exchange based in Seychelles, disclosed its intent to launch a new perpetual swap for XRP. The firm announced in a blog post that it will officially introduce the contracts on Feb. 5 at 4:00 UTC. 

The newest perpetual swap will be paired against the U.S. dollar. It will offer investors the ability to trade it with leverage of up to 50x, according to BitMEX. All margin will be posted in BTC and traders will be able to long or short the XRP/USD perpetual contract only using Bitcoin as collateral.

Following the announcement, Arthur Hayes, co-founder and CEO of BitMEX, joked about the actual name of this cryptocurrency since it used to be called Ripple until recently. Hayes also pointed out that the high levels of interest that investors have shown for this token led the company to list the perpetual swap. 

Is it called Ripple, XRP, or dogshit? Who knows, who cares. It’s worth more than zero so it’s time to trade the USD pair on BitMEX. Boo-Yaka-sha! https://t.co/pa3T5vd5kl

— Arthur Hayes (@CryptoHayes) February 4, 2020

The introduction of XRPUSD perpetual contracts on BitMEX comes at a time when XRP has seen its price appreciate by nearly 50% since mid-December 2019. Now, this event could serve as the catalyst that allows this cryptocurrency to retrace before it continues its bullish trend.

The TD sequential indicator is currently presenting a sell signal on XRP’s 1-day chart. The bearish formation was given in the form of a green nine candlestick, which estimates a one to four candlestick correction. 

Based on this technical index, a red to candlestick trading below a preceding red one candle could serve as confirmation of the sell signal. 

Adding credence to the bearish outlook, a bearish divergence between the price of XRP and the Relative Strength Index (RSI) is forming within the same time frame. 

Divergences occur when the price of an asset is making a series of higher highs while the RSI is making lower highs. Although this technical pattern does not provide a precise selling point, it is a sign that the uptrend is reaching an exhaustion point. 

An increase in sell orders could push XRP down to the 100-day moving average. Breaking below this significant price hurdle could trigger a further decline. Such a bearish impulse could take this cryptocurrency to test the 50-day moving average for support. 

Nevertheless, the massive inflow of capital that the cryptocurrency market has experienced since Jan. 3 makes it impossible to omit the bullish case. Therefore, if demand for XRP increases, allowing it to close above its 200-day moving average, then it would likely try to test the next level of resistance around $0.30. 

Now, the price effects of BitMEX’s XRP perpetual swaps remain to be seen.

The post BitMEX Rolls out New Financial Product for XRP appeared first on Cryptocurrency News.

Similar to Notcoin - TapSwap on Solana Airdrops In 2024

origin »

145 +