Despite a Volatile Start, Ripple (XRP) Token Stages a Notable Recovery, Stabilizing Near the $2 Mark

Following a volatile start to the week—when Ripple's native token plunged to a low of $1.64—the crypto asset staged a notable recovery.

Cryptocurrency prices remained volatile on Thursday, with Ripple’s (XRP) token staging a partial recovery to trade above the $2 mark.

XRP price rose above the $2 psychological level on Thursday, signaling some recovery after a volatile start to the week that saw the token fall to lows of $1.64.

The move follows a partial rollback of new reciprocal tariffs imposed by President Donald Trump’s administration.

According to reports from the U.S., the administration has decided to pause a sweeping tariff plan for 90 days and slash duties to 10% for over 75 non-retaliating countries.

Tariffs on Chinese goods, which had soared to 125%, will be reduced to 75%, signaling a partial rollback of the trade war measures.

The move comes as part of broader efforts to stabilize global financial markets, which have been battered by trade tensions and the coronavirus pandemic.

The S&P 500 futures gained 9.5% in early trading on Thursday, while major cryptocurrencies also saw significant price increases. Bitcoin rose by over 8% to trade above $17,000, while XRP followed with a 9% gain to trade above the $2 mark.

The rapid price movement in XRP led to the liquidation of $18 million in short positions within 24 hours, according to data from Coinglass. Overall, liquidations across long and short trades neared $24.16 million.

The wave of forced exits among bearish traders could inject fresh momentum into the market, suggesting that XRP’s bulls are regaining control.

According to derivatives market activity, open interest in XRP surged by 6.68% to $3.05 billion, while options volume jumped by 21.36% to $7,670. A spike in open interest typically signals an influx of new capital and growing trader engagement—a potential precursor to sustained upward movement.

“The price recovery from $1.61 to above $2 makes XRP increasingly attractive to long-position traders,” said a Coinglass analyst. “We’re now watching closely for confirmation signals like MACD crossover and volume support.”

On-chain metrics also suggest that XRP may be entering a stage of technical optimism.

According to data from Santiment, XRP’s Market Value to Realized Value (MVRV) ratio remains nearly 9.5% below the mean, a historical buy signal. This negative MVRV suggests that most XRP holders are currently underwater, reducing the likelihood of near-term selling pressure and supporting a potential rebound.

“Whenever MVRV dips below zero, it implies undervaluation,” analysts from Santiment noted. “This is when smart money typically accumulates.”

However, XRP’s recovery isn’t without hurdles. Daily active addresses have sharply declined—from 581,000 in mid-March to just over 10,000 this week. A decrease in network activity may indicate reduced organic demand, potentially dampening momentum unless usage picks up.

Despite the recent volatility, macroeconomic factors are increasingly influencing the XRP price outlook.

With the Federal Reserve facing pressure to cut interest rates, traders are placing bets on a more liquidity-rich environment.

Historically, rate cuts have been bullish for cryptocurrencies, which tend to benefit from looser monetary policy as it injects capital into the system, leading to outflows from traditional low-yield assets like bonds and into riskier assets like equities and cryptocurrencies.

“All risk assets, including crypto, tend to benefit from easier monetary policy,” said XRP community figure ‘All Things XRP’ in a conversation with CC.

According to him, rate cuts increase the opportunity cost of holding cash, leading to a search for yield across various asset classes. In this environment, XRP and Bitcoin become attractive alternatives to traditional low-yield assets.

However, the market’s reaction depends heavily on the context of the rate cut. If perceived as a response to strength, the move could fuel a rally. Conversely, if it signals economic distress, investor caution may prevail.

According to long-term analysis using Elliot Wave theory, XRP’s token may currently be in Wave 2 of a five-wave cycle.

Popular analyst XForceGlobal suggests a final drop below $1 could complete Wave 2, marking an ideal buy zone before the powerful Wave 3 catapults XRP to a projected $20 high.

“Wave 3 is typically the strongest and most explosive in the Elliot Wave sequence,” said the analyst. “Assuming fundamentals hold, we could see a tenfold increase in market cap.”

Wave 4 could bring a retracement to $7 before a final surge to $30 concludes the cycle.

While this long-term vision may take years to play out, it provides a roadmap for high-conviction investors navigating short-term volatility.