Ripple (XRP) Price Analysis: Bear Traders Seize Control as Open Interest Falls Below $5.5B

XRP price traded lower for a second consecutive day, slipping 2.03% to $2.36 on May 17 amid rising legal uncertainty and bearish derivatives flows.

US District Judge Analisa Torres’ latest ruling in the SEC vs. Ripple case has sparked fresh doubts about XRP’s institutional clarity, while open interest and trader sentiment reflect decline in investor confidence.

Could weak trading volumes trigger further downsizing over the weekend?

Judge Torres’ Ruling Casts Doubt on XRP’s Regulatory Future

Ripple (XRP) price tumbled to weekly lows around $2.3 on Friday after Judge Analisa Torres rejected a joint motion from Ripple and the SEC that sought clarity on the ban against institutional XRP sales.

The negative market reaction continued on Saturday, as Ripple price traded as low as $2.31  as the decision to uphold the $125 million settlement find now introduces fresh regulatory risks as appeals could run till end of the year.

Without that, Ripple remains trapped in a gray zone, and investors are beginning to price in the likelihood that this legal stalemate could last well into 2025.

Bearish Flows Deepen as Market Participation Wanes

The US Judge’s decision took many bull traders by suprise. Those impacted have spent the last 24 hours repositioning trades to suit the latest twist in the Ripple vs SEC case.

Coinglass‘ derivatives trading data shows XRP Open Interest is down 6.47% to $4.71 billion, reflecting a rapid exit from leveraged long positions. Trading volumes have also collapsed by 23.35%, a clear sign that many traders are scaling down exposure to XRP amid the regulatory uncertainty.

Despite this broader retreat, some large traders appear to be positioning for a reversal, with top accounts maintaining a bullish long/short ratio.

Yet that optimism contrasts with mounting long liquidations, which totalled $11.67 million over the last 24 hours, while short liquidations remained negligible.

What’s Next for XRP?

With the next court deadline not until mid-June, XRP will likely remain under pressure, locked between fragile support and sliding sentiment.

The ETF narrative that once boosted optimism now looks increasingly remote as legal clarity dims. Traders may continue to de-risk until either the SEC signals an official appeal or Ripple produces a more compelling motion.

Until then, XRP price is likely to consolidate with a narrow channel betweeen $2 and $3, swinging with broader market narrative.

XRP Price Forecast Today: Bearish Crossover Emerges as Bulls Struggle to Defend $2.31 Support

XRP is trading at $2.36 and showing signs of further weakening as bearish sentiment builds across both technical and derivative market structures. The token is now leaning into its volume-weighted average price at $2.34, which, if lost, could trigger a retest of the $2.31 support band marked by the Bollinger midline.

On the daily chart, the Bollinger Bands have begun to narrow, reflecting declining volatility and suggesting an imminent directional breakout.

A sustained breakdown below the $2.31 zone would confirm bearish control, potentially exposing XRP to a sharp decline toward the lower Bollinger Band near $2.02.

The MACD crossover further compounds this risk by validating loss of bullish momentum, especially as the histogram begins to slope downward, confirming momentum exhaustion among buyers.

However, with Ethereum price forecast today also showing signs of short-term stabilization above key VWAP support, there is still a possibility of correlated sentiment holding XRP above the major psychological support at $2.

XRP has historically mirrored ETH movements during consolidation phases, and if ETH regains strength above $2,500, XRP could reclaim upside structure toward $2.48–$2.50 in the coming sessions. But for now, the XRP price indicators largely remain neutral-to-bearish.

Until XRP decisively reclaims $2.40 with a strong close above the VWAP and MACD begins to steepen upward again, caution remains warranted.

Conversely, failure to hold the $2.31 level would reinforce bearish continuation, while a bounce from this region could offer a relief rally.

The next 48 hours will be key in validating whether this XRP traders capitulate into further downside or stabilizes back toward the $2.50 resistance level.