XRP (XRP) traded at $1.31 on Mar. 31, hovering just above the $1.30 neckline of a head-and-shoulders pattern that carries an 18% breakdown target — while derivatives data and on-chain metrics present conflicting signals about which direction the token moves next.
XRP Neckline Battle
The 4-hour chart shows a completed right shoulder at $1.36, a head at $1.60 and a neckline running through $1.30. A close below $1.29 would confirm the pattern and open downside targets at $1.24, $1.17 and $1.12.
Open interest rose from $741.8M on Mar. 28 to $752.1M by Mar. 31.
The funding rate dropped from -0.0016 to -0.007 over the same period — a 4.3x negative shift. That combination points to aggressive new short positions at the neckline, with traders betting on a completed breakdown.
Yet the same positioning sets up a potential short squeeze. On Mar. 26, open interest stood near $784M with funding at -0.01, and instead of breaking down, XRP bounced from $1.35 to $1.37 as shorts covered. The current setup closely mirrors that episode.
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Divergence and Supply Shift
A standard bullish divergence is forming on the 4-hour chart between Mar. 27 and Mar. 31. Price is making a lower low toward the $1.30 neckline, but the Relative Strength Index is close to confirming a higher low above the 36 level.
That divergence suggests buyer momentum is building even as price drifts lower.
A funding rate reversal toward neutral, paired with falling open interest, would signal short liquidations and could push XRP toward $1.36.
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