XRP Leads Cryptocurrency Market Recovery, Surging 18% to Reach $2.24

The cryptocurrency market has shown resilience this week with XRP leading a strong recovery. After dropping below $2 in recent days, Ripple's native token has bounced back to reach $2.24.

Cryptocurrency prices have shown resilience this week with Ripple’s XRP leading a strong recovery. After dropping below $2 in recent days, the token has bounced back to reach $2.24. This 18% price jump comes as investors react to multiple positive developments and two key factors driving XRP’s price movement.

Market analysts highlight growing optimism about a resolution to Ripple’s legal battle with the SEC and favorable macroeconomic conditions, particularly regarding Federal Reserve policy.

Sources familiar with the matter suggest negotiations between the SEC and Ripple are advancing. The regulator’s proposal reportedly includes a $125 million fine and restrictions on Ripple’s ability to sell XRP to institutional investors.

This legal clarity could remove a major obstacle that has limited XRP’s growth potential. The lawsuit has kept many US-based exchanges from listing XRP since December 2020. A resolution might encourage these platforms to relist the token.

Recent inflation data has further boosted market sentiment. February’s Consumer Price Index showed inflation cooling to 2.8%, down from January’s 3%. This reading came in below the expected 2.9%, suggesting price pressures are easing.

The CME Group’s FedWatch tool now indicates a 99% probability that the Federal Reserve will maintain current interest rates at its March 21 meeting. This outlook has strengthened investor confidence in risk assets like cryptocurrencies.

Technical Analysis:

* XRP is currently trading in a range between $2.03 and $2.27.

* The Relative Strength Index shows upward momentum with a reading above 50.

* The Ichimoku cloud pattern suggests an upcoming bullish crossover, which could signal further price gains.

* A successful break above the $2.34 resistance level could open the path toward $2.60. This level coincides with the upper Bollinger Band.

* Failure to hold above $2.24 could see prices test support at $1.92.

Derivative Market Activity:

* Open interest has increased by 3.48% to $3.05 billion, indicating sustained interest in XRP.

* Options open interest has surged 10.69% to $1.37 million, suggesting traders are placing bets on future price movements.

* Long/short ratios across major exchanges reveal strong bullish sentiment. Binance data shows a 2.49 long/short ratio for XRP/USDT pairs.

* OKX traders display similar confidence with a 2.14 ratio. These numbers suggest more traders are betting on price increases.

* Recent liquidation events have favored bulls over bears. Data shows $4.61 million in short liquidations versus $4.25 million in long liquidations over a 24-hour period. This suggests short sellers are facing increasing pressure.

Other Developments:

* Beyond the SEC lawsuit, other developments could support XRP’s growth. Ripple is working on a DFSA license to expand its blockchain payment capabilities.

* Institutional interest in XRP has grown with major asset managers exploring XRP-linked investment products. Franklin Templeton has joined Grayscale and WisdomTree in working toward an XRP ETF.

* Volume analysis indicates selling pressure may be weakening. The recent price surge follows a contraction in volume after a 1.63 billion token selloff. This pattern suggests sellers are losing momentum while buyers step in.

* The recent price action follows a steep 27.53% correction from previous highs. Buyers have successfully defended the early recovery gains above $2.24. A continued rally could target the $2.76 level seen in recent weeks.