XRP recovery gains momentum despite retail market decline

Mild ETF inflows support XRP recovery

Institutional investors continued accumulating XRP spot Exchange-Traded Funds (ETFs), with $1.28 million in inflows on Thursday despite ongoing price volatility.

According to SoSoValue data, US-listed XRP ETFs recorded three consecutive days of net inflows, following approximately $19.5 million on Tuesday and $4.8 million on Wednesday.

The cumulative inflows stand at $1.21 billion, and net assets under management at approximately $888 million. Sustained ETF inflows typically reflect positive investor sentiment and can often correlate with bullish momentum in the underlying asset.

Meanwhile, the XRP derivatives market extends its weakness, with futures Open Interest (OI) declining to $2.40 billion on Friday, the lowest level since early January 2025, from $2.61 billion on Thursday.

OI tracks the notional value of outstanding futures contracts, which gauges retail interest. A persistent decline suggests low conviction in the asset’s ability to sustain a steady price increase.

XRP Futures Open Interest | Source: CoinGlass

XRP’s ongoing recovery lacks the support of the retail market, while institutional interest remains low. Therefore, traders should closely monitor OI trends to maintain an optimistic stance amid volatility. Meanwhile, pressure from liquidated positions has eased, given the ongoing price recovery. According to CoinGlass, approximately $10 million in longs and $10.5 million in shorts have been liquidated on Friday, compared to $59 million in longs and $11 million in shorts on Thursday. As the XRP price rises, pressure on long positions is poised to ease, potentially supporting the recovery.

XRP liquidation data | Source: CoinGlass

Technical outlook: XRP edges higher as bulls return

XRP has extended its price action above $1.36, but remains below the 50-day Exponential Moving Average (EMA), at $1.88, the 100-day EMA at $2.05 and the 200-day EMA at $2.22. All three moving averages slope lower, reinforcing the overall bearish structure, while the descending trend line from $3.66 limits advances with resistance at $2.18.
The Moving Average Convergence Divergence (MACD) is in negative territory on thedaily chart, with its line below the signal line and a contracting negative histogram suggesting that bearish momentum is gradually easing. Meanwhile, the Relative Strength Index (RSI) at 29 on the same chart is still oversold despite the intraday increase. Any bounce in the RSI could face supply against nearby dynamic resistances.

A close above the threshold at $1.40 may accelerate the uptrend beyond the next hurdle at $1.50. However, the overall downtrend, as portrayed by the moving averages, could push XRP to retest its intraday low at $1.12.

Crypto ETF FAQs

What is an ETF?

An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.

Is Bitcoin futures ETF approved?

Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.

Is Bitcoin spot ETF approved?

Yes. The SEC approved in January 2024 the listing and trading of several Bitcoin spot Exchange-Traded Funds, opening the door to institutional capital and mainstream investors to trade the main crypto currency. The decision was hailed by the industry as a game changer.

Which are the pros and cons of crypto ETFs?

The main advantage of crypto ETFs is the possibility of gaining exposure to a cryptocurrency without ownership, reducing the risk and cost of holding the asset. Other pros are a lower learning curve and higher security for investors since ETFs take charge of securing the underlying asset holdings. As for the main drawbacks, the main one is that as an investor you can’t have direct ownership of the asset, or, as they say in crypto, “not your keys, not your coins.” Other disadvantages are higher costs associated with holding crypto since ETFs charge fees for active management. Finally, even though investing in ETFs reduces the risk of holding an asset, price swings in the underlying cryptocurrency are likely to be reflected in the investment vehicle too.

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