XRP nears key support as derivatives demand deteriorates
- XRP slips, targets $1.00 key support area amid extreme fear in the crypto market.
- The XRP derivatives market continues to deteriorate, with Open Interest in perpetual futures slipping to $2.41 billion.
- XRP ETFs attracted $7.44 million in inflows on Tuesday but failed to lift the outlook as weak momentum indicators prevailed.
Ripple (XRP) grinds lower, trading around $1.10 at the time of writing on Wednesday. The sticky bearish outlook mirrors the broader crypto market, with major coins such as Bitcoin (BTC) and Ethereum (ETH) facing weak demand as investors de-risk.
Risk-off sentiment keeps suppressing XRP retail demand
Retail appetite for XRP derivatives has significantly deteriorated, with futures Open Interest (OI) averaging at $2.41 billion on Tuesday, compared to $4.14 billion one year ago and a record high of $10.94 billion in July.
The drop in demand, keeping the OI subdued, suggests that investors lack confidence in XRP’s ability to sustain the uptrend. Until retail interest returns and sustains a consistent uptrend, XRP may struggle to maintain its uptrend.
Meanwhile, XRP spot ETFs edged higher on Tuesday, attracting inflows of $7.44 million following muted activity on Friday and Monday. Cumulative inflows are steady at $1.43 billion, while net assets average $982 million. Despite the inflows, declines remain dominant, with XRP targeting support at $1.10.
Analysis analysis: XRP sell-off depends
XRP trades at $1.10, extending a bearish near‑term bias as price holds well below the key Exponential Moving Averages (EMAs). The 50-day EMA at $1.31, the 100-day EMA at $1.40 and the 200-day EMA at $1.62 all sit overhead, suggesting rallies are likely to face selling interest, while the SuperTrend line at $1.26 also reinforces the topside cap.
Momentum remains heavy, with the Relative Strength Index (RSI) hovering in oversold territory near 29 on the daily chart and the Moving Average Convergence Divergence (MACD) histogram printing negative values, which hints that downside pressure persists even if short-covering bounces emerge.
On the topside, initial resistance is seen at the SuperTrend barrier around $1.26, ahead of a more substantial cluster formed by the 50-day EMA at $1.31 and the 100-day EMA at $1.40. Beyond these, the 200-day EMA at $1.62 marks a major hurdle that would need to be reclaimed to alleviate the broader bearish structure. As long as XRP trades below this cluster of moving averages, rallies are likely to be viewed as corrective.
Respecting that the prevailing configuration of moving averages keeps the pair vulnerable to further downside until at least the SuperTrend and shorter EMAs are decisively cleared.
(The technical analysis of this story was written with the help of an AI tool.)
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.
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
