XRP eyes rebound despite muted ETF demand
- XRP defends support at $1.20 and rises above $1.23 on Wednesday despite risk-off sentiment amid Middle East tensions.
- XRP faces muted ETF demand amid fading retail interest, weighing on its recovery outlook.
- XRP rebounds after crashing to $1.20 but remains constrained below major downtrending moving averages.
Ripple (XRP) rebounds above $1.23 from support at $1.20 at the time of writing on Wednesday, as the broader cryptocurrency market pares losses triggered by escalating tensions in the Middle East.
Appetite for risk assets remains generally low as the United States (US) and Iran exchange fire amid a fragile ceasefire and peace negotiations. Despite US President Donald Trump stating that peace talks with Iran are progressing as usual, reports broadly suggest that Iranian negotiators had stopped communication in protest at Israel’s offensive in Lebanon.
Meanwhile, crypto assets are under pressure, as evidenced by the crypto Fear & Greed Index, which is at 11 in the Extreme Fear territory on Wednesday, down from 23 the previous day. This slump suggests that risk-averse sentiment prevails and may continue to weigh on the appetite for cryptocurrencies.
XRP capital outflows reinforce risk-off market sentiment
XRP derivatives cooled further with perpetual futures Open Interest (OI) falling to $2.65 billion on Wednesday, from $2.65 billion the day before. The OI, representing the notional value of outstanding futures and options contracts, is extending its correction from highs slightly above $3 billion in mid-May.
Moreover, it remains significantly below the record $10.94 billion in July, suggesting that appetite for derivatives remains suppressed. Unless investors start opening new positions aggressively and seeking risk exposure, it would be difficult to sustain the minor rebound.
Institutional participation is similarly on the back foot, given that activity in spot Exchange-Traded Funds (ETFs) was muted on Tuesday, with US-listed ETFs closing with zero flows. According to SoSoValue, cumulative inflows stand at $1.43 billion while net assets under management average $1.04 billion.
Price analysis: XRP tests rebound strength
XRP trades above $1.23, while holding under a firm bearish bias. The pair also remains below the 50-day Exponential Moving Average (EMA) at $1.37 and the 100-day EMA at $1.44, while the 200-day EMA around $1.65 reinforces a broader downtrend backdrop.
At the same time, the SuperTrend indicator, currently aligned near $1.38, sits above spot and adds to the overhead supply zone, while the Moving Average Convergence Divergence (MACD) histogram stays in negative territory with a weak profile on the daily chart, suggesting that downside momentum is still present even as the Relative Strength Index (RSI) recovers from oversold levels toward the low-30s.
On the topside, initial resistance emerges from a confluence of short-term structures, with the 50-day EMA near $1.37 and the SuperTrend line around $1.38 forming the first cap that bulls would need to reclaim to ease immediate pressure. Beyond that area, the 100-day EMA at roughly $1.44 is the next key barrier ahead of the descending trendline break level near $1.5232, while the 200-day EMA around $1.65 marks a more distant hurdle that would need to be overcome to negate the prevailing bearish structure.
(The technical analysis of this story was written with the help of an AI tool.)
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
Author
John Isige
FXStreet
John Isige is a seasoned cryptocurrency journalist and markets analyst committed to delivering high-quality, actionable insights tailored to traders, investors, and crypto enthusiasts. He enjoys deep dives into emerging Web3 tren
