[DigitalToday reporter Kim Ye-seul] XRP is forming a bullish pattern, while rising exchange inflows and declining XRPL activity are emerging as variables.

On March 5 (local time), blockchain media outlet BeInCrypto reported that the XRP price rose about 5 percent over the past 24 hours, leading a rebound in the broader cryptocurrency market. With the rise, XRP recovered about 16 percent from its Feb. 28 low, forming a bullish pattern for further gains. However, it said it was unclear whether the uptrend would continue due to rising exchange inflows, expanding derivatives leverage and weaker XRPL activity.

On the 8-hour chart, XRP is forming a cup-and-handle pattern, suggesting room for additional gains. The right side of the cup formed after a 16 percent rebound from the Feb. 28 low, and it is now consolidating in the handle area. If the price breaks the neckline, it could rise to $1.72, around the $1.70 zone, but limited participation by institutional investors is acting as a constraint.

XRP ledger activity is also declining. Payment transactions that stood at 2.18 million in early last month have fallen 53 percent to 1.03 million, while trading volume on the XRPL decentralised exchange (DEX) has plunged 83 percent to $5.09 million from $30.85 million. It said this points to weaker organic demand for XRP, making it harder for the rally to persist.

In the derivatives market, leveraged positions increased, reflecting expectations of a rise. From March 2 to 5, XRP futures open interest rose 18 percent to $859 million from $728 million, and funding rates turned positive. However, leverage has declined over the past few trading days, suggesting some long positions have been liquidated.

XRP is trading around $1.42, and a break above $1.46 to $1.47 could open the way for further gains. On the other hand, if it falls below $1.26, the bullish pattern could be invalidated, the outlet reported.