XRP, one of the leading cryptocurrencies, has been facing significant downward pressure in recent weeks. The asset’s price has dropped by over 20% in the month so far and 7% in the past week. This decline mirrors the overall market sentiment in the crypto industry. As a result, XRP’s total market capitalization has fallen to $26 billion, and the trading volume has decreased by 11% in the past day.
Several factors have contributed to the decline in XRP’s price. First, the general crypto market sentiment has been bearish, with the overall crypto market cap dropping to $1.04 trillion. Bitcoin, the premier cryptocurrency, has been struggling to break above the crucial level of $26,000, which has had a negative impact on the entire crypto market.
Moreover, major altcoins like Ethereum, Solana, Dogecoin, and Cardano have also experienced losses of more than 3% each. This overall market downturn is reflected in the Crypto Fear and Greed Index, which currently stands at a fear level of 35, indicating increased selling pressure.
Another significant factor affecting XRP’s price is the ongoing legal battle between the U.S. Securities and Exchange Commission (SEC) and Ripple Labs. In July, XRP saw a surge of over 70% after a federal judge ruled that it was considered a security only when sold to institutional investors. However, this rally was short-lived as the SEC filed for an interlocutory appeal, focusing on programmatic and other sales of XRP. In their filing, the SEC referred to XRP as “nothing but a computer code with no inherent value.”
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The regulatory environment in the UK has also played a role in XRP’s lackluster performance. UK regulators have emphasized that cryptocurrencies lack intrinsic value. This stance by regulators adds to the uncertainty surrounding XRP’s regulatory status, further impacting its price.
From a technical analysis perspective, the daily chart shows that XRP has been trading sideways for the past few weeks. It has struggled to maintain its position above the critical level of $0.500. XRP remains below both the 50-day and 200-day exponential moving averages, as well as the 50-day and 100-day simple moving averages. The Relative Strength Index (RSI) has fallen to 34, indicating an increase in selling pressure.
Based on these technical indicators, it is likely that XRP will continue to trade sideways in the near future as it struggles to find direction. If the price falls below the important support level of $0.500, it could pave the way for further losses towards the next support level at $0.4545. On the other hand, if XRP manages to break above the major hurdle at the 200-day Exponential Moving Average (EMA) at $0.5290, it could signal a bullish momentum and potentially push the price higher towards the 50-day EMA.
In conclusion, XRP’s price has been negatively impacted by the bearish market sentiment in the crypto industry and ongoing regulatory concerns. The legal battle between Ripple Labs and the SEC has cast a shadow of uncertainty over the asset’s future. However, technical analysis suggests that XRP may continue to trade sideways in the near term. Traders and investors should closely monitor market developments and regulatory updates to make informed decisions regarding XRP.
