XRP price drops 5% following bitcoin’s sharp rise and fall, causing volatility in crypto markets
XRP experienced a significant downturn, dropping below the $1.92 mark due to increased selling pressure and tumultuous volatility across various asset classes during the U.S. trading session. This decline coincided with sudden reversals in bitcoin, U.S. stock markets, and AI-related stocks, leaving alternative cryptocurrencies vulnerable as the market liquidity decreased and derivative positions were reset.
Early U.S. trading witnessed extreme fluctuations in the crypto market, with bitcoin surging briefly from $87,000 to over $90,000 before retracting back to the $87,000 level. Simultaneously, there were sharp declines in AI-related equities such as Nvidia, Broadcom, and Oracle, resulting in a more than 1% drop in the Nasdaq. Sentiment soured following reports of Blue Owl Capital withdrawing funding from a $10 billion Oracle data-center project, adding pressure to risk assets connected to AI infrastructure. The abrupt market swings led to liquidations exceeding $190 million in the crypto space within a span of four hours, with long positions amounting to $72 million and short positions totaling $121 million, according to CoinGlass data. XRP’s performance was subdued compared to the broader market, as the impact of derivative-driven flows hit mid-beta altcoins harder during the abrupt volatility surge.
When delving into technical analysis, support levels for XRP were identified at $1.90 as the immediate defense line, with a secondary support zone of $1.75–$1.64 if $1.90 fails to hold. Resistance levels were marked at $1.94–$1.99 in the short term, representing the previous support turned into supply, with a psychological barrier at $2.00, which has now been solidly rejected. The volume structure analysis indicated rejection near $1.9885, which recorded the highest volume of the session, confirming distribution patterns and active selling rather than passive participation. There is yet no evidence of seller exhaustion. The trend structure shifted bearish following a breakdown below a key Fibonacci retracement level, with lower highs forming before the rejection, signalling a decline in momentum. Additionally, consolidation patterns resolved to the downside, emphasizing the bearish momentum. The failed attempt to breach the $2.00 mark acted as a bull trap, and continued price acceptance below $1.94 maintains the downside bias.
Traders are closely monitoring several key factors, including whether the $1.90 support level holds or breaks, which would quickly expose the $1.75–$1.64 zone. They are also watching for reactions if the price retests the $1.94–$1.99 range, as a rejection there would confirm the continuation of the prevailing trend. The market is awaiting developments regarding the alleviation or perpetuation of macro volatility, which could trigger further deleveraging across asset classes. Moreover, traders are analyzing derivatives positioning post the $190 million in liquidations, as the direction depends on which market participants reload their positions first. The relative performance of XRP against BTC will also be crucial if bitcoin stabilizes near the $87,000 mark.
