- The XRP price has been in a strong downward trend.
- The Federal Reserve will deliver its interest rate decision on Wednesday.
The XRP price has been under intense pressure in the past few days as cryptocurrency investors waited for the upcoming interest rate decision by the Federal Reserve. Ripple is trading at $0.6162, which was about 70% below the highest level in 2021. Its market cap has dropped to about $29 billion.
Fed Decision Ahead
Ripple is a leading blockchain project that enables companies accelerate their money transfer process. It has been widely adopted by some of the biggest companies in the industry even as the SEC vs Ripple case continues.
Like other cryptocurrencies, the XRP price has been in a strong bearish trend recently as investors focus on the upcoming interest rate decision by the Federal Reserve. The same trend has happened in other assets like stocks and bonds.
The Fed will conclude its two-day meeting on Thursday and then deliver its monetary policy statement. Analysts expect that the bank will deliver a 0.50% rate hike after its meeting. If this happens, it will be the first time it has done that in over 20 years.
Historically, higher interest rates have not been good for stocks and other risky assets like cryptocurrencies. However, this is not to say that the XRP price will decline after the decision comes out. In fact, there is a possibility that the opposite will happen since a tighter policy has already been priced in.
Another reason why Ripple and other top cryptocurrencies are not doing well is a psychological phenomenon known as sell in May and go away. This is a situation where most financial assets tend to underperform starting from May. For example, after surging to record highs in May 2021, the cryptocurrency winter happened until July.
XRP Price Prediction
The four-hour chart shows that the XRP price has been in a strong bearish trend in the past few months. It has remained below the descending trendline that is shown in black. At the same time, it has moved below the 25-day and 50-day moving averages while the Stochastic Oscillator has moved the oversold level.
Therefore, there is a likelihood that Ripple will drop and retest the support at $0.5463 after the FOMC decision and then resume the bullish trend shortly afterward. A move above $0.70 cannot be ruled out.
Also, we created the following Ripple guides so you can learn more about this cryptocurrency:
When will the interest rate decision be delivered by The Federal Reserve?
The Federal Reserve will deliver its interest rate decision on Wednesday.
