XRP (Ripple) at $2 Faces Potential Risk in Latest Market Decline – What Comes Next?

XRP has been facing significant pressure as it struggles to hold the $2 level amidst a broad market sell-off. This downward trend in XRP’s price comes as part of a larger decline in the cryptocurrency market, with XRP specifically dropping by 4.55% over the last 24 hours to $2.07.

The recent dip in XRP’s price is part of a consistent pattern of losses since mid-April, with the digital asset seeing downturns in two out of three trading days. Despite this recent decline, XRP is still up by 14% for the week, showcasing some resilience in the face of volatile market conditions.

The negative trend in the market began on Tuesday with a drop in Nvidia shares during after-hours trading, leading to a shift in market sentiment that continued into Wednesday. This sentiment shift resulted in around $240 million in liquidations in the cryptocurrency market over the last 24 hours, according to data from CoinGlass.

While XRP saw a decline in price, the development of an XRP exchange-traded fund (ETF) from ProShares, aiming for a debut on April 30, has provided some fundamental support for the digital asset. This ETF approval could potentially attract institutional investors and boost mainstream adoption of XRP, offering a positive outlook for the cryptocurrency amid the current market pressures.

Technically, XRP’s performance around the critical $2 support level holds significance. A successful defense of this level could signal a potential rebound towards the $2.23 resistance and the 50-day Simple Moving Average (SMA). Conversely, failure to maintain support at $2 could lead to further declines, potentially pushing XRP down to the $1.61-$1.72 support zone where historical buying interest has been present.

Several economic factors are also influencing XRP and the broader cryptocurrency market, with Wednesday’s U.S. retail sales report and Federal Reserve Chairman Jerome Powell’s upcoming speech being closely monitored by market participants. Strong retail numbers and insights from Powell’s speech could impact market sentiment and influence monetary policy considerations.

In conclusion, XRP’s ability to navigate the critical $2 support level amidst the ongoing market sell-off will be influenced by a combination of macroeconomic indicators and cryptocurrency-specific developments, such as the ProShares XRP ETF filing. Market participants are advised to closely monitor these factors to gain insights into XRP’s future price action and market trajectory.