Here is why XRP could continue its rise

• Ripple price stabilizes above its daily support level of $0.544, eying a rally ahead.
• On-chain data paints a bullish picture as XRP’s open interest is rising and is highest in one month.
• A daily candlestick close below $0.544 would invalidate the bullish thesis.

Ripple (XRP) stabilizes and trades above a key support level on Monday after a nearly 3% rise last week. However, the on-chain data hints at a rally ahead as XRP’s open interest is rising and reaching the highest level in one month, indicating new buying is occurring.

Ripple on-chain metric shows potential for a rally 

Ripple price trades above an ascending trendline (drawn from connecting multiple low levels from early July ) and has been consolidating above its daily support level of $0.544 over the past week. This daily level is a crucial support zone because it closely matches with the 200-day Exponential Moving Average (EMA) at $0.552. As of Monday, XRP trades at around $0.588.

If the 200-day EMA and the daily support around $0.544 manage to hold, XRP could continue its upward trend and retest its daily resistance level at $0.626.

The Moving Average Convergence Divergence (MACD) indicator further supports XRP’s rise, signaling a bullish crossover on the daily chart. The MACD line (blue line) moved above the signal line (yellow line), giving a buy signal. It shows rising green histogram bars above the neutral line zero, also suggesting that Ripple’s price could experience upward momentum.

Additionally, the Relative Strength Index (RSI) indicator trades at 56, above its neutral level of 50. A cross to levels over 60 would indicate that bullish momentum is gaining traction.

XRP/USDT daily chart

Ripple’s on-chain data further supports the bullish thesis. Coinglass’s data shows that the futures’ Open Interest (OI) of XRP at exchanges is also increasing. The OI indicates the total number of outstanding derivative contracts that have not been settled (offset by delivery) and whether money flows into the contract are increasing or decreasing.

Increasing OI represents new or additional money entering the market and new buying, which suggests a bullish trend. On the contrary, when OI decreases, it is usually a sign that the market is liquidating, more investors are leaving, and prices may decrease.

The graph below shows that Ripple’s OI increased from $639.08 million on Thursday to $754.65 million on Sunday, the highest level in over a month. This rise indicates that new or additional money is entering the market and new buying is occurring.

XRP Open Interest Chart

However, the bullish outlook would be invalidated if Ripple’s daily candlestick closes below the $0.544 daily support level and breaks below the ascending trendline. In such a case, XRP would decline 7.5% to retest its September 6 low of $0.502.