Trader Takes Bold Short Position on XRP While Bullish on Shiba Inu

• Analyst Lars Kooistra maintains 40% short position on XRP despite recovery.
• Trader simultaneously opens long position on Shiba Inu based on accumulation pattern.
• Contrarian plays come as both assets show strong positive correlation in market.

Prominent crypto and forex trader Lars Kooistra has revealed a surprising contrarian strategy involving two popular cryptocurrencies, maintaining a bearish stance on XRP while simultaneously expressing bullish sentiment toward Shiba Inu. This divergent approach comes at a time when both assets have shown related price movements in recent market activity.

Kooistra disclosed that he continues to hold a 40% short position on XRP, despite the fourth-largest cryptocurrency’s recent price recovery. The trader initially established this bearish position approximately one week ago, basing his decision on what he described as a “high-probability technical cycle time (TCT) model 2 distribution schematic” that suggested downside potential.

According to Kooistra’s update, he has already closed 60% of his XRP short trade at a realized profit of 2.60%. While XRP did close the previous week in negative territory due to Bitcoin’s volatile price action, the token has since rebounded strongly, potentially challenging the remaining short position that Kooistra maintains.

“The position is risk-free at this point,” Kooistra noted, indicating his continued confidence in XRP eventually reaching his target price of $2, despite the current recovery that works against his position.

Several analysts share bearish XRP outlook

This bearish stance on XRP aligns with other prominent analysts, including Koroush AK and Cole Garner, who have recently encouraged their followers to short the XRPL native token, predicting substantial downward movement. However, market observers note that an abundance of short positions could potentially trigger a “short squeeze” if XRP experiences a sudden significant price increase, which would accelerate upward momentum.

In contrast to his XRP position, Kooistra revealed he has established a mid-term long position on Shiba Inu. The trader cited a “high probability TCT model 1 accumulation schematic” visible on higher timeframe charts as the basis for his bullish outlook on the popular meme token.

Explaining his seemingly contradictory positions, Kooistra emphasized that his contrarian play stems from different technical signals appearing on the higher timeframes for each asset. “They tell a different story on the higher timeframe,” he stated, suggesting that XRP will respond differently to prevailing market conditions compared to SHIB.

What makes this divergent strategy particularly interesting is the strong price correlation that has developed between Shiba Inu and XRP in recent weeks. Market data indicates that while SHIB has demonstrated more bullish momentum, both assets have generally moved in similar directions. With both currencies currently showing upward movement, Kooistra’s maintained short position on XRP could face increasing pressure.

The trader’s willingness to take opposing positions on assets that have displayed correlated price action highlights the complex nature of cryptocurrency trading strategies that incorporate multiple timeframe analysis. While short-term market movements may show similarities between assets, traders like Kooistra are betting on divergences based on longer-term technical patterns.