XRP flaunts bullish structure above $3 ahead of REX-Osprey ETF debut
|- XRP holds $3.00, reflecting the calm in the crypto market ahead of Wednesday's Federal Reserve interest rate decision.
- Bloomberg's James Seyffart hints at REX-Osprey XRP ETF launch this week.
- XRP is still at risk of extending declines below the $3.00 level if macro factors fail to support a bullish outcome.
Ripple (XRP) upholds a bullish picture trading above the critical $3.00 level on Tuesday, as market participants await the United States (US) Federal Reserve (Fed) interest rate decision this Wednesday.
The consensus is that the Federal Open Market Committee (FOMC) will cut interest rates by 25 basis points to a range of 4.00 to 4.25%, amid growing optimism for a 50 bps cut.
A rate cut could support the crypto market's bullish outlook in the fourth quarter, as investors seek exposure to riskier assets such as crypto and equities.
Could XRP rally as XRP ETF launch debuts?
The REX-Osprey XRP Exchange Traded Fund (ETF) is expected to start trading in the US this week, Bloomberg analyst James Seyffart said via X on Monday. Following the launch, investors in the traditional market will, for the first time in the US, have spot exposure to XRP.
The ETF, expected to trade under the ticker XRPR, differs from Bitcoin and ETH spot ETFs as it provides exposure to the underlying asset's spot price by holding XRP and other XRP ETF products listed globally.
"The fund documents also have language that would allow derivatives usage for exposure if needed but that definitely isn't the primary exposure method," Seyffart stated.
REX Shares, the company behind the XRPR ETF, did not specify the launch date; however, Seyffart stated that the product could start trading this Thursday, alongside Dogecoin's DOJE ETF, which is also supported by the same entity.
Bitcoin and Ethereum spot ETFs are playing a fundamental role in the cryptocurrency market, allowing direct exposure to the two largest digital assets by market capitalization for traditional investors on stock exchanges.
Inflows in BTC and ETH ETFs have fueled price surges in both assets, reflecting increasing demand. Hence, the launch of the XRPR ETF could drive interest in the cross-border money remittance token, possibly fuelling the next run-up to new all-time highs above the $3.66 reached on July 18.
Technical outlook: XRP eyes bullish breakout
XRP remains above $3.00 at the time of writing on Tuesday, supported by a descending trendline and the 50-day Exponential Moving Average (EMA) at $2.94.
The Relative Strength Index (RSI), currently rebounding at 54 after testing the midline, supports a scenario where bullish momentum builds ahead of a breakout toward the record high of $3.66.
The Moving Average Convergence Divergence (MACD) indicator backs XRP's bullish case, maintaining a buy signal since September 8. Investors will consider increasing their exposure to XRP with the blue MACD line remaining above the red signal line.
XRP/USDT daily chart
Besides the XRPR ETF, the Fed interest rate decision this Wednesday could shape the outlook of the broader cryptocurrency market. A rate cut would boost risk-on sentiment for digital assets, including XRP.
If market dynamics shift to the bearish side and the price of XRP slips below the $3.00 level, the 50-day EMA at $2.94, the 100-day EMA at $2.81 and the support tested at $2.70 on September 1 would be in line to absorb the selling pressure.
Crypto ETF FAQs
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Yes. The SEC approved in January 2024 the listing and trading of several Bitcoin spot Exchange-Traded Funds, opening the door to institutional capital and mainstream investors to trade the main crypto currency. The decision was hailed by the industry as a game changer.
The main advantage of crypto ETFs is the possibility of gaining exposure to a cryptocurrency without ownership, reducing the risk and cost of holding the asset. Other pros are a lower learning curve and higher security for investors since ETFs take charge of securing the underlying asset holdings. As for the main drawbacks, the main one is that as an investor you can’t have direct ownership of the asset, or, as they say in crypto, “not your keys, not your coins.” Other disadvantages are higher costs associated with holding crypto since ETFs charge fees for active management. Finally, even though investing in ETFs reduces the risk of holding an asset, price swings in the underlying cryptocurrency are likely to be reflected in the investment vehicle too.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.