XRP climbs amid steady ETF inflows and derivatives demand
- XRP gains momentum with $1.37 serving as a stepping stone for a potential breakout above $1.40.
- XRP ETFs extend mild inflows for a fourth consecutive day as more capital flows in through derivatives.
- XRP momentum indicators remain fragile, which could limit upside potential in the short to medium term.
Ripple (XRP) rises above $1.37 at the time of writing on Wednesday, after testing a short-term support at $1.35. The rebound follows a rejection XRP suffered at $1.50 in mid-May, triggered largely by macroeconomic uncertainty surrounding rising United States (US) inflation and geopolitical tensions in the Middle East.
Meanwhile, the Federal Reserve (Fed) is set to release the Minutes of April’s policy meeting at 18.00 GMT on Wednesday. Market participants will look for cues on the committee’s hawkish stance and overall policy direction amid hotter-than-expected April inflation data and the prolonged US-Iran conflict, which continues to keep Oil and Gas prices elevated.
Capital inflows could boost XRP outlook
Institutional interest in XRP spot Exchange-Traded Funds (ETFs) has remained relatively steady, with inflows increasing to $1.48 million on Tuesday, from $750,000 the day before. SoSoValue data shows a four-day bullish streak, steadying cumulative inflows at $1.39 billion, while net assets under management average $1.12 billion. The rising demand for spot ETFs is helping shape sentiment positively, raising the odds of a sustained rebound.
The XRP retail market maintains a positive outlook, with perpetual futures Open Interest (OI) rising to $2.93 billion on Wednesday, up from $2.83 billion the previous day. A sustained increase in the OI could help steady the price of XRP toward the pivotal $1.40 level.
Price Analysis: XRP holds key support as bulls eye recovery
XRP trades at $1.37, keeping a bearish near-term tone as it holds below the 50-day, 100-day and 200-day Exponential Moving Averages (EMAs) at $1.41, $1.48 and $1.69, respectively. The rising trendline support, now turned resistance around $1.40, reinforces a downside bias.
Meanwhile, the Relative Strength Index (RSI) near the low-40s on the daily chart and a negative, slipping Moving Average Convergence Divergence (MACD) histogram hint that bearish momentum is still in play despite some cooling in Money Flow Index (MFI) readings from previously overbought territory.
On the topside, initial resistance emerges at the ascending trendline near $1.40, followed by the 50-day EMA around $1.41, where sellers could attempt to reassert control. A sustained recovery above these barriers would be needed to open the way toward the 100-day EMA at $1.48 and the more distant 200-day EMA near $1.69. On the downside, the area at $1.35 provides initial support with extended losses likely to retest the $1.30 demand level.
(The technical analysis of this story was written with the help of an AI tool.)
Cryptocurrency metrics FAQs
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value.
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
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
