Ripple’s XRP is showing notable resilience as it clings to the $2.00 mark, even after a turbulent weekend in the crypto markets. The recent sell-off, triggered by escalating Middle East tensions, saw XRP briefly dip to $1.90 before recovering. Despite this volatility, several key indicators suggest that XRP’s fundamentals remain robust, positioning the token for a potential rebound in the coming weeks.
Institutional Interest Remains Steady
Last week, XRP-related financial products attracted $2.69 million in inflows, reflecting ongoing institutional interest. While this figure trails behind inflows for Solana, Ethereum, and Bitcoin, it underscores a steady appetite for XRP among professional investors. The launch of three XRP spot ETFs in Canada last week further highlights growing demand for regulated exposure to the asset.
Exchange Reserves Drop, Reducing Sell Pressure
On-chain data from CryptoQuant shows a sharp 21% decline in XRP exchange reserves, falling from $2.9 billion in May to $2.3 billion. This reduction means fewer tokens are available on exchanges, which typically translates to lower sell-side pressure and a more favorable environment for price stability or growth.
Treasury Allocations and DeFi Momentum
Major treasury allocations continue to flow into XRP. Notable recent investments include $500 million from Singapore’s Trident Technologies, $300 million from China’s Webus International, and $121 million from London-based VivoPower. These funds are being channeled into decentralized finance (DeFi) initiatives and the XRP Ledger, supporting the ecosystem’s expansion.
Technical Picture: Mixed Signals Amid Macro Uncertainty
Technically, XRP is struggling to reclaim the $2.09 resistance, defined by the 200-day Exponential Moving Average (EMA). The Moving Average Convergence Divergence (MACD) indicator has signaled bearish momentum since mid-May, and the Relative Strength Index (RSI) currently sits at 35, suggesting the token is nearing oversold territory. A move above the midline on the RSI could indicate a shift back to bullish momentum.
Meanwhile, derivatives data from CoinGlass shows open interest in XRP futures has dropped from $5.52 billion in mid-May to $3.54 billion, while trading volume surged to $8.7 billion amid a wave of liquidations. This heightened activity could set the stage for a short squeeze, potentially driving a technical reversal if buying pressure intensifies.
Key Levels to Watch
• Resistance: $2.09 (200-day EMA), $2.25, $2.65
• Support: $2.00, with a potential downside to $1.90 if selling resumes
Macro Factors Remain in Play
Geopolitical tensions, particularly between the US and Iran, continue to inject uncertainty into the market. As noted by risk managers, further escalation could prompt investors to seek safer assets, putting additional pressure on crypto prices. However, the easing of volatility and steady institutional inflows suggest that XRP could weather the storm if broader market conditions stabilize.
Outlook
While XRP faces short-term headwinds, its strong fundamentals—shrinking exchange reserves, institutional inflows, and growing DeFi adoption—provide a solid foundation for recovery. Traders should monitor key technical levels and macro developments closely, as these will likely dictate the next major move for XRP.
