XRP tests rebound strength amid ETF and futures drawdowns
|- XRP edges higher for the second consecutive day, holding $1.35 as immediate support on Wednesday.
- XRP retail demand cools as futures Open Interest drops to $2.45 billion, likely limiting recovery potential.
- XRP ETF activity remained muted on Tuesday after outflows of $2.3 million on Monday, reflecting sticky risk-off sentiment.
Ripple (XRP) is trading above $1.35 at the time of writing on Wednesday, rising from its daily open of $1.34. Despite the remittance token securing support above the $1.35 level after edging higher for the second consecutive day, overall retail and institutional demand remains subdued.
Meanwhile, attention remains on whether XRP can sustain its rebound amid evolving sentiment and liquidity conditions.
XRP institutional and retail interest fade
The United States (US) and Israel’s war with Iran, which is now in its second month, has continued to weigh on crypto assets as recovery attempts are quickly absorbed, leading to frequent pullbacks.
Sentiment, as reflected in the XRP spot Exchange-Traded Funds (ETFs), remains weak following muted activity on Tuesday. As reported, US-listed ETFs experienced outflows totaling $2.3 million on Monday.
Cumulative inflows have steadied at $1.21 billion, while net assets under management have dropped to around $944 million, from the record $1.65 billion on January 1.
Retail demand has similarly weakened, as evidenced by futures Open Interest (OI) in the derivatives market, falling to $2.45 billion on Wednesday from $2.54 billion the previous day.
In contrast, OI peaked at a record $10.94 billion in July, coinciding with the price hitting an all-time high of $3.66. This sharp decline has dampened retail investor interest in the token and signals their reluctance to take on additional risk.
Technical outlook: XRP edges higher as support holds
XRP is trading slightly above $1.35 as its near-term bias stays neutral-to-bearish. The price continues to oscillate beneath the broken descending resistance line, with the latest rebound attempts failing to secure follow-through above the $1.43 area. The cluster of 50-day, 100-day and 200-day Exponential Moving Averages (EMAs) well above spot underscores a dominant downside backdrop.
Moreover, the Moving Average Convergence Divergence (MACD) indicator holds below the signal on the daily chart, suggesting persistent negative momentum. The Relative Strength Index around 43 remains below the midline on the same chart, reinforcing a downside tilt but not yet indicating oversold conditions.
XRP's initial resistance is now seen near $1.37, ahead of the $1.40–$1.43 band that capped recent bounces and aligns with the broken trendline region. A daily close above $1.43 would be needed to ease bearish pressure and open the way toward the $1.45–$1.52 zone. On the downside, immediate support emerges at $1.33, followed by last week’s low near $1.30. A break here would expose the $1.25 demand handle. As long as price holds below $1.43, rallies would be vulnerable to renewed selling into these resistance levels.
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.
(The technical analysis of this story was written with the help of an AI tool.)
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