XRP Rebound Wipes Out $2.92M in Short Positions

Edgen Crypto

·Jan 26 2026, 15:45

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Key Takeaways

A sharp price rebound in XRP triggered a massive short squeeze, liquidating millions in bearish bets and signaling a potential shift in market momentum. The event highlights extreme volatility and the risks associated with leveraged short positions.

XRP's price rebounded sharply on January 26 after a brief dip below $1.83 during Asian trading hours.
The upward move forced the liquidation of $2.92 million in short positions over a 12-hour period.
This created a 37,296% liquidation imbalance, indicating a classic "bear trap" that has removed significant selling pressure.

Price Rebound Liquidates $2.92M in Shorts

XRP executed a classic bear trap on January 26, catching short sellers off-guard with a swift price reversal. After briefly dipping below the $1.83 support level in the early Asian session, the price rebounded sharply. The move triggered a cascade of liquidations, wiping out $2.92 million in short positions within just 12 hours, according to data from CoinGlass. Long positions, in contrast, remained almost entirely untouched.

Imbalance Reaches 37,296%, Signaling Price Floor

The scale of the short squeeze is evident in the 37,296% imbalance between short and long liquidations over the 12-hour window. This overwhelming pressure on bearish bets removes a significant layer of selling activity from the market. Such a powerful liquidation event often establishes a firm price floor, as the forced closure of short positions adds buying pressure. This dynamic can create conditions for a near-term price increase as any remaining short sellers may be compelled to cover their positions to avoid further losses.