XRP Faces Downward Pressure Amid Market Uncertainty
Ripple (XRP) is currently navigating a landscape of increasing downside risks, mirroring the overall bearish sentiment prevailing in the market. This comes as Bitcoin (BTC) has dipped below $108,000. Despite ongoing interest in the XRP token, particularly within the derivatives market, it is trading around $2.22, reflecting a decrease of over 1% at the time of reporting.
Key Indicators Paint a Mixed Picture
The Open Interest (OI) for XRP futures stands at $4.61 billion, marking a significant 23.2% increase from the June lows of $3.54 billion. Open Interest represents the total value of futures and options contracts that remain open, meaning they haven’t been settled or closed.
A sustained rise in Open Interest typically suggests a growing appetite for risk, as traders are actively betting on future price increases. However, other factors are contributing to the current market uncertainty.
Exchange Balances Rise as New Addresses Decline
The number of XRP tokens held on exchanges has seen a rise of nearly 4.4%, reaching 3.41 billion from the 3.23 billion recorded on June 25th. This increase in exchange balances can pose a risk to XRP’s price, as investors are more likely to sell when they transfer assets to exchanges.
If this upward trend continues, any potential recovery in price could be overshadowed by selling pressure, impacting price action. This is a trend worth monitoring closely in the coming days and weeks.
Concurrently, the number of new addresses on the XRP Ledger (XRPL) has remained below the 5,000 mark since May 22nd. New addresses created stood at 4,389 as of Thursday.
Network activity, encompassing elements like active addresses and new addresses, often correlates directly with XRP’s price. The recent decline in new addresses suggests weakening demand for XRP, which exerts downward pressure on its price. This can also affect transaction volume and overall market sentiment.
During the recovery in late 2024 and early 2025, the number of addresses created on XRPL consistently rose, peaking at 31,840 on December 2nd. This level remained significantly higher than current figures until mid-March.
Despite these challenges, the fundamental outlook for XRP has the potential to improve over time, especially with continued interest in the token. The rising Open Interest in futures contracts demonstrates this.
Ripple’s commitment to building a new-era financial system by bridging the gap between the cryptocurrency industry and traditional finance, using the Ripple Payments platform and its RLUSD stablecoin infrastructure, could drive increased demand for XRP.
Demand for institutional-grade digital financial systems could strengthen XRP’s market dynamics, particularly if the Office of the Comptroller of the Currency (OCC) grants Ripple a national bank charter. Ripple has also applied for a Federal Reserve (Fed) master account, which would allow it to hold RLUSD reserves directly with the Fed, enhancing trust and security.
Technical Analysis: XRP Could Extend Losses
XRP is showing signs of extending its intraday pullback heading into the weekend, supported by a sell signal from the Moving Average Convergence Divergence (MACD) indicator on the 4-hour chart.
Traders are likely to reduce their exposure as the MACD blue line falls below the red signal line. Red histogram bars below the zero line indicate bearish pressure. The Relative Strength Index (RSI) moving slightly below the midline suggests that the downtrend could gain momentum.
The 50-period Exponential Moving Average (EMA) at $2.20 is positioned to absorb selling pressure. If the price falls below this level, the 200-period EMA at $2.19 and the 100-period EMA at $2.18 could serve as additional short-term support levels. Other key levels that traders might consider as tentative support include $2.15, tested on Wednesday, and $2.07, last explored on June 27th.
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