- XRP price correction breaks below the key support of $1.9 as the market correction ends
- Binance data shows XRP’s Estimated Leverage Ratio slipping to around 0.18, among the lowest readings in recent months.
- A 50-day EMA slope acts as key dynamic resistance against XRP buyers.
XRP, the native cryptocurrency of the XRP Ledger, is down 4.75% during Monday’s U.S. market hours. The sell-off coincides with a broader market pullback as the Bank of Japan is set to hike interest rates by 25bps. Amid micro-economic jitters, the XRP price faces additional pressure as traders withdraw from the leverage market and hold a cautious outlook for this asset.
XRP Sees Leverage Compression as Traders Exit Borrowed Positions
On Binance, XRP perpetual contract Estimated Leverage Ratio metrics have dropped steadily to near 0.18, one of the lower readings in the past few months, while the asset trades below the $2 level.
This decrease in the ratio indicates that traders are winding down the usage of borrowed money, which includes many funding contracts being completely exited or reduced in size. Such adjustments tend to follow periods of heavy market swings or down adjustments, in which the participants dial out exposure and readjust trades.
From a structural perspective, lower levels of leverage tend to signal lower vulnerability in the market overall, with the lower probability of panicky position closures that are triggered by sudden price changes.
The timing of this leverage pullback has coincided with XRP moving lower from previous highs above $3. This overlap indicates that the latest price retreat was less a result of the construction of aggressively borrowed positions, but more of the process of unwaggressively positioning. Past patterns in similar setups often represent interim stages of trading movement, moving away from heavy directional bets toward position realignment.
If the Estimated Leverage Ratio is stuck at these depressed levels, this could be supportive of firmer price action ahead (provided a gradual rebuilding of derivatives participation occurs without excessive borrowing). Advances that took place with a small margin of leverage would have lower risks of quick reversals.
The current 0.18 Estimated Leverage Ratio on Binance for XRP reflects limited involvement from the derivatives portion, as traders are still preparing to create a more stable footing before any more specific signal as to whether or not there will be a recovery or a continued range-bound trade.
XRP Price Losses Multi-Month Support
With today’s market decline, the XRP price teases a bearish breakdown from the $1.9 level- a horizontal support intact since mid-April 2025. If the breakdown materializes with daily candle closing, the selling pressure would accelerate and drive a nñearly 7.7%, before price seeks support at the bottom trendline of a falling-wedge pattern.
Since early October 2025, the chart setup has carried a steep correction trend within two converging timelines, which offers dynamic resistance and support. The down-slipping trend of key exponential moving averages (20, 50, 100, and 200) accentuates the bearish sentiment in the broader market.
Typically, the chart pattern is formed at the end of a downtrend as it allows buyers to reincorporate the exhausted bullish momentum. Therefore, the XRP price is poised for a bullish breakout from this pattern to restore a recovery moment.
A potential breakout will bolster the asset by another 22% before challenging the key resistance trendline of a falling wedge pattern as shown above.
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