XRP Approaching Critical Short Squeeze Levels as Liquidity Builds Above $2.40

The technical signals indicate that XRP might be approaching a short squeeze, according to crypto analyst CryptoInsightUK. The on-chain and derivatives data show substantial liquidity above current prices, increasing open interest, and a pattern similar to previous squeeze scenarios. The dense liquidity zones are identified around $1.90 and $2.40, suggesting that once XRP breaks higher, short sellers could face forced liquidations. The open interest has steadily increased since June 24, with negative premium and oscillating funding rates, implying an accumulation of short positions. Combining this with liquidity heatmaps, the analyst considers a probable upcoming short squeeze. Nonetheless, caution is advised as there is liquidity below current levels, leaving room for fakeouts or downward sweeps before a real rally occurs. Ethereum’s changing liquidity also signals shifts in trader positioning, which could influence XRP’s movement. The current traded price at $2.18 and the target liquidity zone at $2.40 imply potential upward momentum, but the market remains uncertain.