If XRP breaks below $1.31, further decline is likely

▲ XRP decline/ChatGPT generated image ©

XRP (Ripple) is holding near the $1.33 support level, but the market sentiment is deteriorating. While spot ETF inflows continue, their scale is limited, and technical indicators also point to a bearish trend, increasing the likelihood of further decline.

According to investment media FXStreet on May 27 (local time), XRP continues its sideways movement near $1.33 amid uncertainty surrounding the signing of a Memorandum of Understanding (MOU) between the United States and Iran. Analysts suggest that market participants are maintaining a wait-and-see attitude without a clear direction, leading to limited movement for XRP.

Market sentiment is cooling rapidly. The Fear & Greed Index dropped from 34 the previous day to 25 today, entering the 'extreme fear' zone. With weakening risk asset preference, the possibility of an XRP rebound is also limited. However, institutional capital flows have not completely stopped. According to SoSoValue data, the XRP spot ETF saw an inflow of $1.55 million today, with cumulative net inflows reaching $1.41 billion. Total net assets stand at approximately $1.12 billion.

Retail investors' participation in the derivatives market remains relatively stable. According to CoinGlass, XRP futures Open Interest recorded $2.93 billion today, a slight increase from $2.85 billion the previous day. The media analyzed that if retail investor demand remains consistent, it could support a bullish scenario for XRP, but conversely, a decrease in demand could act as a price pressure factor.

Technical trends remain negative. XRP is currently trading below its 50-day Exponential Moving Average (EMA) of $1.40, 100-day EMA of $1.47, and 200-day EMA of $1.68. The Relative Strength Index (RSI) hovers around 39 on the daily chart, indicating a bearish trend, and the Moving Average Convergence Divergence (MACD) histogram consistently remains in negative territory, signaling a continued seller-dominated market.

The media suggested $1.40 as a short-term resistance level, with $1.47 and $1.68 likely to act as additional resistance zones thereafter. Conversely, on the downside, an upward trendline near $1.31 serves as a key support level, and if this area breaks on the daily chart, it could lead to a deeper corrective phase.

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