XRP Price Forecast: XRP tests key support as fresh US-Iran tensions outweigh ETF inflows
- XRP slides from the critical $1.50 supply zone, tests the $1.45 support level on Monday.
- Fresh tensions between the US and Iran emerge as Trump dismisses the latest Iranian proposal to end the war.
- XRP-related digital investment products saw nearly $40 million in inflows last week, suggesting improving risk-on sentiment.
Ripple (XRP) declines from highs around $1.50 and tests a short-term $1.45 support at the time of writing on Monday. The remittance token reflects a sudden shift in broader crypto market sentiment as fresh tensions in the Middle East have further challenged the path to a lasting peace agreement between the United States (US) and Iran.
Middle East tensions weigh on XRP despite capital inflows
United States President Donald Trump has rejected Iran’s counterproposal to end the war in the Middle East, saying that it is “totally unacceptable.” According to a CNN report, the proposal leaned on Iran’s sovereignty over the Strait of Hormuz while seeking compensation for war damages.
Following Trump’s remarks, Iranian Foreign Ministry spokesperson Esmail Baghaei said that everything in the proposal was “reasonable” and “generous” for Iran’s national interests as well as for the region’s and the world’s stability, the CNN report added.
The broader crypto market, which has in the last few weeks priced in a potential final peace agreement amid the ongoing but fragile ceasefire, shows signs of exhaustion, with XRP down at least 1.36% on the trading day.
Meanwhile, appetite for XRP-related digital investment products remained steady last week, as reflected by nearly $40 million in inflows, according to a CoinShares report published on Monday. Total assets under management average $2.5 billion, the fourth-largest as per the chart below.
XRP spot Exchange-Traded Funds (ETFs) accounted for approximately $34 million of the above-mentioned $40 million in total inflows into digital investment products. Cumulative ETF inflows now stand at $1.32 billion, with net assets under management averaging $1.12 billion.
Despite the sudden pressure on XRP on Monday, retail demand continues to increase, as futures Open Interest (OI) remains at $2.87 billion, up from $2.65 billion the previous day. A further increase in OI would suggest strong investor conviction in XRP’s ability to sustain its rebound.
Technical outlook: XRP tests rebound strength above support
XRP trades at around $1.45, while holding well above the 50, 100, and 200 Exponential Moving Averages (EMAs) clustered between roughly $1.42 and $1.40 on the 4-hour chart, which suggests a constructive near-term bias. Still, the near-term $1.50 supply area caps the medium-term recovery.
Meanwhile, momentum readings are positive but not extreme, with the Relative Strength Index RSI) hovering in the high-50s on the 4-hour chart and the Money Flow Index (MFI) easing from prior overbought territory, hinting at a pause rather than an outright reversal after the recent surge. Although the Moving Average Convergence Divergence (MACD) histogram is marginally positive on the same chart, it is contracting and starting to weigh on the momentum.
On the downside, initial support is seen at the 50 EMA around $1.42, ahead of the 100 EMA near $1.41 and the 200 EMA at $1.40, where buyers would be expected to defend the short-term uptrend on dips. On the topside, the next notable hurdle is aligned with the double-top pattern's resistance marginally above $1.50. A decisive break above this barrier would open the door for a more extended advance.
(The technical analysis of this story was written with the help of an AI tool.)
Open Interest, funding rate FAQs
Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.
Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.
Nothing in this material constitutes investment advice, personal recommendation, investment research, an offer, or a solicitation to buy or sell any financial instrument. The content has been prepared without consideration of your individual investment objectives, financial situation, or needs, and should not be treated as such.
Past performance is not a reliable indicator of future performance and/or results. Forward-looking scenarios or forecasts are not a guarantee of future performance. Actual results may differ materially from those anticipated.
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