XRP is trading above $1.40 at the time of writing on Tuesday, after a 3% jump on Monday. The intraday pullback pauses the bullish start to the week, aligning with news of the US halting attacks on Iran, pricing in which has eased geopolitical tensions in the Middle East and global risk of inflation.
XRP continues to fluctuate within a larger consolidation pattern between $1.3226 and $1.5522, with the descending 50-day Exponential Moving Average (EMA) within the range, serving as intermediate resistance and adding to downside pressure.
Typically, ranges contract the trend momentum, and a breakout on either side leads to sharp and massive moves.
The Relative Strength Index (RSI) at 47 reverses from the midline and points lower, suggesting a deeper correction before reaching the oversold zone.
As XRP loses bullish momentum, the pressure on the $1.3226 support level increases, threatening that a daily close below this level could test the February 6 low at $1.1172, followed by the $1.00 psychological level.
If the US strikes back at Iran, XRP could extend losses further, risking a break below the $1.00 psychological level.
On the upside, XRP must surpass the 50-day EMA at $1.488 and the $1.552 resistance level to break out of the consolidation range. The potential breakout rally could target the overhead resistance trend line connecting the highs of July 18 and October 2, near $1.7711.
A broader market recovery could support XRP’s upward adventure, but as the Middle East tensions continue to weigh down on the crypto market, the recovery in XRP could be pulsating.
XRP derivatives data shows a surge in trading activity, with a 77% increase in volume over the last 24 hours.
Meanwhile, XRP futures Open Interest rose 1.75% to $2.38 billion, signaling a rise in the notional value of outstanding XRP futures contracts, suggesting heightened conviction among traders. Funding rates have recently flipped positive, indicating a growing long bias, particularly among retail participants.
Typically, an increase in Open Interest supported by positive funding rates and a rise in volume signals a boost in retail bullish interest, which aligns with the XRP’s Monday rebound.
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