XRP, one of the leading cryptocurrencies, has recently experienced a significant downturn in its value. Over the past seven days, it has dropped by 4%, and in just 24 hours, it has fallen by nearly 2.9%. As of today, XRP is trading at $2.42, showing a 2.85% decrease. Investors are wondering what is behind this sudden decline and if upcoming economic data might help reverse the trend.
The recent dip in XRP’s price is linked to broader economic decisions, particularly the policies of the U.S. government. On February 10, President Donald Trump’s decision to raise tariffs on steel and aluminum imports to 25% sent shockwaves through the global market. This move was designed to protect domestic industries but created uncertainty in various sectors, including the cryptocurrency market.
XRP’s price had already started to decline. On February 10, the price of XRP dropped to $2.3232, reflecting the initial impact of Trump’s economic strategy. Investors and analysts have linked this decline to fears about the broader economic effects of the tariff hike, which could affect international trade and global markets, including digital currencies.
Earlier in February, President Trump made another move that caused turmoil in financial markets. On February 1, he revealed plans to impose tariffs on imports from Canada, Mexico, and China. This statement led to an immediate drop in the price of XRP. Within the first two days of February, the cryptocurrency fell by about 15%, from $3.0364 to $2.58.
However, the situation escalated when China retaliated by imposing counter-tariffs on U.S. goods, which intensified concerns about a global trade war. As a result, from February 4 to February 6, XRP’s price dropped by 13.87%, marking a significant decline in the cryptocurrency’s value. By February 6, XRP had lost over 23% of its value, a sharp drop that has left the market reeling.
As the market continues to face challenges, many investors are turning their attention to the upcoming release of inflation data. Economic indicators, especially inflation rates, can influence market behavior, and many are hopeful that better-than-expected inflation data could improve market sentiment.
Cryptocurrencies, including XRP, are often seen as a hedge against inflation. If the inflation data comes in lower than expected, it could shift investor sentiment and lead to a recovery in XRP’s price. Historically, when inflation is lower than forecasted, markets tend to respond positively, especially in uncertain economic climates.
Looking at XRP’s technical indicators reveals several important insights. The 50-day simple moving average (SMA) for XRP is at $2.4114, while the 100-day SMA is at $2.1684. The 200-day SMA is lower at $1.3641, reflecting a longer-term downtrend. Currently, XRP’s price is hovering around $2.42, and its 14-day Relative Strength Index (RSI) is at 38.61, which is approaching oversold territory. This suggests that a price correction could be on the horizon if conditions improve.
The Relative Volatility Index (RVI) stands at 51.29, indicating moderate market volatility. Additionally, the Average True Range (ATR) is 0.2331, showing that XRP has experienced substantial price movement recently. These technical indicators suggest that XRP remains in a neutral phase, but market conditions could shift with upcoming economic data.
The decline in XRP’s price can be attributed to several factors, including U.S. trade policies and ongoing concerns about global economic stability. However, the release of upcoming inflation data could provide some relief for the cryptocurrency market, including XRP. If inflation is lower than expected, it could encourage investors to turn to assets like XRP, which are perceived as more stable during times of economic uncertainty.
While the market is still recovering from recent declines, there is hope that better economic conditions and favorable data could help XRP regain its footing. However, given the volatility of the cryptocurrency market, investors will need to stay alert to changing economic indicators and market trends.
A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5
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