XRP weakens as retail demand falters despite ETF inflows
- XRP remains under pressure, with the price slipping toward $2.00 despite nine consecutive weeks of inflows into the ETFs.
- Low retail demand continues to weigh on XRP as highlighted by futures Open Interest narrowing to $4 billion.
- A downtrending RSI signals a weakening technical structure as volatility intensifies across the broader crypto market.
Ripple (XRP) is trading downward toward $2.00 at the time of writing on Monday, weighed down by declining retail interest. Despite steady inflows into related Exchange Traded Funds (ETFs), XRP faces increasing downside risks that could push its price below $2.00.
XRP wobbles amid low retail demand, steady ETF inflows
The XRP derivatives market has continued to weaken since Tuesday, when futures Open Interest (OI) surged to $4.55 billion. CoinGlass data shows the OI, representing the outstanding value of futures contracts, averaging $4 billion on Monday, reflecting the gradual decay.
This persistent decline suggests investors are losing confidence in XRP’s ability to sustain the uptrend and may be employing risk management measures to limit further losses.
Traders are increasingly piling into long positions in XRP, as reflected by the OI-Weighted Funding Rate metric, which has risen 0.0051% at the time of writing on Monday from -0.0018% earlier in the day. Lower prices could be attracting traders to lean into risk, which may add to the tailwind and drive XRP higher.
US-listed XRP ETFs have remained largely unaffected by price fluctuations, as they have recorded nine consecutive weeks of inflows since their launch in November. XRP ETFs drew $38 million last week, according to SoSoValue data, with inflows on Friday nearing $5 million.
The cumulative inflow stands at $1.22 billion, and net assets at $1.47 billion. Despite steady inflows into ETF products, a sustained recovery has been elusive, with XRP down almost 20% since mid-November.
Technical outlook: Can XRP defend key support?
XRP is trading at $2.04 at the time of writing on Monday and remains below the 50-day Exponential Moving Average (EMA) at $2.07, the 100-day EMA at $2.21, and the 200-day EMA at $2.32, keeping the broader tone under pressure. The Relative Strength Index (RSI) is at 51 and falling on the daily chart, signaling a likely transition from bullish to bearish momentum.
The Moving Average Convergence Divergence (MACD) blue line is poised to slide below the red signal line, which would confirm a sell signal. Since, positive histogram above the mean line has contracted, an immediate recovery in XRP price could remain elusive. A break below the $2.00 level could accelerate the downtrend toward a January 1 low of $1.81.
The descending trend line from $3.66 record high limits gains, with resistance at $2.33. A break above the 50-day EMA at $2.07 would target the 100-day EMA at $2.21, while clearance of the 200-day EMA at $2.32 and the trend resistance could shift the bias to the upside.
Ripple FAQs
Ripple is a payments company that specializes in cross-border remittance. The company does this by leveraging blockchain technology. RippleNet is a network used for payments transfer created by Ripple Labs Inc. and is open to financial institutions worldwide. The company also leverages the XRP token.
XRP is the native token of the decentralized blockchain XRPLedger. The token is used by Ripple Labs to facilitate transactions on the XRPLedger, helping financial institutions transfer value in a borderless manner. XRP therefore facilitates trustless and instant payments on the XRPLedger chain, helping financial firms save on the cost of transacting worldwide.
XRPLedger is based on a distributed ledger technology and the blockchain using XRP to power transactions. The ledger is different from other blockchains as it has a built-in inflammatory protocol that helps fight spam and distributed denial-of-service (DDOS) attacks. The XRPL is maintained by a peer-to-peer network known as the global XRP Ledger community.
XRP uses the interledger standard. This is a blockchain protocol that aids payments across different networks. For instance, XRP’s blockchain can connect the ledgers of two or more banks. This effectively removes intermediaries and the need for centralization in the system. XRP acts as the native token of the XRPLedger blockchain engineered by Jed McCaleb, Arthur Britto and David Schwartz.
(The technical analysis of this story was written with the help of an AI tool.)
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
