- XRP risks deeper losses if the $1.2829 support level fails to hold this week ahead.
- Falling open interest to $2.89B signals reduced leverage and cautious trading now.
- Mixed spot flows and regulatory uncertainty could limit XRP’s recovery momentum.
XRP faces renewed selling pressure as its recent recovery loses momentum and derivatives activity continues to contract. The token trades near $1.2945 after failing to sustain its advance toward the $1.45–$1.50 region.
Additionally, XRP now sits below both its 20-day and 200-day exponential moving averages. However, the token remains above its 50-day and 100-day averages, leaving part of its broader recovery structure intact.
XRP Price Faces Key Technical Test
XRP currently trades below the $1.3496 20 EMA and $1.3540 200 EMA. These averages now create a significant resistance band for any attempted recovery.
A move above $1.3410 would provide the first indication of improving momentum. However, XRP needs to reclaim the $1.3496–$1.3540 zone to strengthen its short-term structure.
Consequently, a sustained move above this area could open the path toward $1.4250. This level represents the 0.618 Fibonacci retracement and could attract fresh profit-taking.
Additionally, a stronger breakout could bring the $1.5485 level into focus. That area aligns with the 0.786 Fibonacci retracement and represents another major hurdle.
On the downside, $1.2829 remains the first important support. A break below that level could expose the $1.2569–$1.2543 region.
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The zone combines the 0.382 Fibonacci retracement with the 100 EMA. Hence, buyers may attempt to defend this area if selling pressure intensifies.
Falling Open Interest Signals Reduced Leverage
XRP’s derivatives market has undergone a substantial reset since the token’s July advance. Open interest climbed above $10 billion as XRP approached the $3.50 region.
However, open interest declined steadily throughout August and September. By September 16, the figure had fallen to approximately $2.89 billion.
The contraction suggests traders have reduced leveraged exposure as XRP’s price momentum weakened. Significantly, open interest remains above early-year levels.
Therefore, derivatives activity has not disappeared despite the sharp decline from its yearly peak. A stabilization in open interest could offer an important signal for XRP’s next directional move. Moreover, rising open interest alongside strengthening prices could indicate renewed market participation.
Spot Flows Remain Mixed
XRP’s spot flow data also points toward cautious market behavior. Outflows dominated much of the period, particularly between late November and January.
Several outflow spikes exceeded $40 million, while some approached $70 million. Meanwhile, inflows appeared less consistently and generally produced shorter-lived moves.
From March onward, both inflows and outflows moderated. However, outflows continued appearing more frequently than inflows.
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Recent activity has become more balanced, with occasional positive spikes emerging. XRP recorded a $6.72 million net inflow on September 16. Nevertheless, the broader price decline suggests traders remain cautious despite these intermittent inflow events.
Legal Developments Add Another Variable
XRP also enters this period amid renewed regulatory uncertainty in Washington. The Senate rejected a procedural motion connected to the Clarity Act.
The vote failed to secure the 60 votes required to advance the legislation. Consequently, the bill did not move forward during the latest Senate effort.
Ripple executives responded by highlighting XRP’s existing legal and regulatory position. Ripple Chief Legal Officer Stuart Alderoty pointed to the 2023 federal court ruling involving XRP.
He also referenced subsequent regulatory developments involving the SEC and CFTC. Additionally, Ripple expects those agencies to continue developing cryptocurrency rules.
Hence, XRP’s near-term price direction will depend on both market structure and broader regulatory developments.
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