Ripple Price Forecast: XRP risks sliding below $2.00 as steady ETF inflows fail to lift sentiment
- 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.
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.
(The technical analysis of this story was written with the help of an AI tool.)
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