• XRP remains vulnerable below the $1.20 pivotal level amid rising downside risks toward the June lows at $1.05.
• XRP muted ETF demand and softening retail interest fan headwinds.
• XRP momentum indicators battle downtrending major moving averages as sellers tighten their grip.

Ripple (XRP) ticks down below $1.20 with short-term support at $1.16 intact at the time of writing on Thursday. An early-week rally was rejected at $1.28, weighing on sentiment as traders broadly de-risked.

Investors de-risk as sentiment softens

The Federal Reserve’s (Fed) hawkish stance and the hint of a tighter monetary policy aimed at achieving the long-term 2% inflation target continue to weigh on the crypto market since the American session on Wednesday. The possibility of a rate hike in 2026 is back on the table, as Fed Chair Kevin Warsh appeared to prioritize stability over early easing in his first post-meeting press conference.

Cryptocurrencies are broadly pressured, trimming recent gains driven by improving sentiment following the United States (US) and Iran's announcement of a peace agreement to end the war.

Sentiment has softened further, as reflected in the Fear & Greed Index, which holds at 15 in the Extreme Fear territory on Thursday, down from 22 the day before. This shows that investors are cautious toward risk assets, with exposure likely to remain subdued in the short term.

XRP spot Exchange-Traded Funds (ETFs) remained quiet, without flows recorded on Wednesday, suggesting that institutional investors have retreated following cautious demand, with inflows of nearly $3 million on Monday and $5 million on Tuesday.

XRP futures Open Interest (OI) dropped to $2.66 billion on Thursday, down from $2.79 billion the previous day, signaling a reduction in risk appetite among market participants.

Persistent weakness in derivatives demand points to diminishing confidence in XRP’s near-term trajectory. As a result, traders appear more likely to close out positions rather than initiate fresh longs, contributing to ongoing selling pressure.

Price analysis: XRP growing downside pressure

XRP trades near $1.17, keeping a bearish near-term tone as price holds beneath the 50-day, 100-day and 200-day Exponential Moving Averages (EMAs) at $1.27, $1.37 and $1.58 respectively. Still, the Moving Average Convergence Divergence (MACD) histogram on the daily chart hints that downside momentum is easing rather than accelerating, leaving the pair in a capped but not yet capitulating configuration.

On the topside, initial resistance lies at the 50-day EMA near $1.27, with further barriers at the 100-day EMA around $1.39 and the 200-day EMA closer to $1.58, levels that would need to be reclaimed to suggest a more durable recovery. Looking down, the Parabolic SAR at $1.08 marks the first significant support. A daily close below this level would expose the pair to renewed selling pressure and potentially extend the broader corrective phase toward June lows at $1.05.

(The technical analysis of this story was written with the help of an AI tool.)