XRP’s price trend still likely has downside ahead as the altcoin closed below the 200-day Simple Moving Average (SMA) at $1.86. Technical indicators point to another retest of the local low at $1.61 or a drop to test the $1.07 low.
The digital asset is currently trading under the 50-day and 100-day SMAs, which is a sign of bearish momentum. XRP’s woes follow a failed bid to maintain bullish momentum after breaking out.
Buyers need to breach stronger headwinds for XRP to start a bullish phase. A clear close over the $2.20 resistance area would be required to see any upside follow-through.
The path to recovery isn't straightforward. A rise above the 50-day SMA at $2.28, accompanied by substantial trading volume, could propel XRP toward the 100-day SMA around $2.50. Here’s what happened: XRP was unable to clear the $2.20 resistance on April 5. Sellers congestion near the $2.20 level capped XRP’s 21.5% April 9th bullish breakout.
The outlook may look even bleaker given extremely negative funding rates in Ripple’s futures markets. This trend is a strong measure of the overall bearish sentiment that has taken hold. The grim picture is compounded by low open interest (OI) in the futures market.
It plunged from $7.87 billion as of January 17 to a meager $3.06 billion by April 10. XRP funding rates have been floating well under 0% since early February.
Moreover, the Relative Strength Index (RSI) continues to sit below the midline, indicating that market conditions are conducive to continued downside movement for XRP.
Even with all the bearish sentiment in the air, XRP holds support on the $1.86, where the price is supported by the 200-day simple moving average (SMA).
