Ripple Price: XRP Could Extend Losses, Eyed Nearly 20% Drop This Week

XRP is facing a significant potential decline of nearly 20% this week, with current support at $1.7600. Recent outflows of over $28 million highlight bearish sentiment, exacerbated by legal uncertainties related to Ripple’s ongoing SEC lawsuit. Key technical indicators suggest further losses could follow without signs of reversal.

Ripple’s cryptocurrency, XRP, is staring down the barrel of a potential decline, with traders anticipating a nearly 20% drop by the end of the week. As of Monday, XRP has already lost nearly 1% of its value, with eyes on a crucial support level at $1.7600 that has stood strong for almost six months. Investment products tied to XRP have seen significant outflows— over $28 million in the last week alone—highlighting a bearish sentiment that’s gripping the altcoin market.

Currently priced at $2.1540, XRP is down about 1.20% for the day, and this price action comes amid broader market uncertainty, particularly as Bitcoin’s consolidation leads to hesitance among crypto traders. The drop in investment into XRP products suggests that traders have grown risk-averse, with many looking to the daily price chart for any signs of a reversal amid persistently negative indicators.

On the technical side, while Ripple is embroiled in a legal dispute with the U.S. Securities and Exchange Commission (SEC), new filings have surfaced raising doubts about the interpretation of the Howey Test. These developments have cast shadows on XRP’s future as its price trends continue to reflect this uncertainty.

For nearly three months, XRP has remained under $2.7000 resistance. The altcoin now faces crucial supports at both $2.0350, which marks the 23.6% Fibonacci retracement from a previous high of $3.4000, and the critical $1.7600 level. Data suggests that if the downturn persists, an 18% drop could see XRP testing those lower support levels.

Technical indicators like the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) lend credence to a bearish outlook for XRP. The RSI currently registers at 39 and is trending downwards, while the MACD presents red histogram bars below the neutral line. These signs point toward continued struggles for XRP as traders assess their next moves.

In broader market news, the ongoing Ripple lawsuit has generated mixed responses from crypto attorneys, who express concern over the degree of legal uncertainty surrounding the outcome. Compounding this sentiment are the significant outflows from XRP-focused investment funds noted in a recent report by CoinShares, which documented a loss of $28 million. All of this indicates that while Ethereum has seen gains, XRP is leading losses in the altcoin realm, further emphasising this precarious situation.

Outside of XRP, there’s been conversation around Exchange-Traded Funds (ETFs) designed for cryptocurrencies. These investment vehicles are seen as a way for investors to gain exposure to crypto without direct ownership. However, while crypto ETFs can reduce some risk and offer relative ease of investment, they also come with drawbacks—most notably, investors don’t hold the actual crypto assets.

The SEC has been notably stringent in approving crypto-related ETFs, delaying approvals over concerns of market manipulation, but recent advancements could change those dynamics. Early in January 2024, the SEC greenlit several Bitcoin spot ETFs, which proponents tout as pivotal for attracting institutional investment and mainstream interest. However, investors need to remember that all investments come with risks, and being informed is crucial.

As always, while this information is aimed to keep market participants updated, one must be cautious and conduct comprehensive research before making any financial decisions. This article represents the personal views of the author and should not be construed as investment advice, as conditions can rapidly change in the crypto landscape.