The XRP price remained on edge on Monday as investors refocused on the upcoming Federal Reserve decision and the US election, in which Joe Biden and Kamala Harris are competing. Ripple was trading at $0.5077, a few points above $0.4875, its lowest point last week.
Crypto investors are fearful
The ongoing XRP price retreat is happening as a sense of fear spreads in the crypto industry. For example, the closely-watched fear and greed index has dropped from last week’s high of 65 to the neutral point of 55.
Bitcoin and other cryptocurrencies have also pulled back. BTC dropped from last week’s high of $73,500 to $68,700, while Ethereum fell to $2,500. The total market cap of all cryptocurrencies has dropped to over $2.3 trillion.
The main catalyst for this weakness is the uncertainty surrounding the upcoming general election, especially because of how close they are.
Data by the New York Times shows that Harris has a slight lead against Trump nationally. However, the two are neck-on-neck in the key swing states.
At the same time, data by Polymarket shows that Trump has a 58% chance of winning, lower than last week’s high of 68%. Still, it is too early to determine whether Polymarket data can be trusted, especially since most of its participants are interested in cryptocurrencies.
A Harris win would likely be positive for XRP price because its founder has donated substantial sums of money to her cause.
Still, we believe that the election results will have some brief volatility, followed by a bullish breakout as the uncertainty wanes.
A key challenge for Ripple is that its ecosystem is not doing well. Its role in the payment services industry has remained under pressure, with not many financial services companies using its technology.
XRP Ledger, its Ethereum rival, has not had any major developers and has been passed by other chains like Sui, Blast, and Base Blockchain. Also, there are concerns about whether its stablecoin, RLUSD, will gain market share in an industry dominated by the likes of Tether and USD Coin.
XRP price forecast
The daily chart shows that the Ripple price has been under pressure in the past few weeks after it formed a double-top at $0.6415. It has moved below the neckline at $0.5098, its lowest swing on September 6.
XRP has moved below the 50-day moving averages, while the Relative Strength Index (RSI) and the MACD have all pointed downwards. Worse, as we wrote last week, Ripple has formed a death cross as the 50-day and 200-day moving averages have crossed each other.
Therefore, the path of the least resistance is downwards, with the next point to watch being at $0.3812, its lowest point on July 5, which is about 25% below the current level.
