XRP (Ripple) plunges to $1.06... Risk aversion spreads ahead of Fed interest rate decision

XRP drops to $1.06... Support line precarious due to $700 million liquidation shock

▲ XRP, cryptocurrency decline/AI-generated image ©

XRP (Ripple) has fallen to $1.06 due to macroeconomic instability and the aftermath of large-scale leveraged liquidations, entering a critical support zone to prevent further declines.

According to cryptocurrency market data aggregator CoinMarketCap, as of July 29 (local time), XRP recorded a 1.30% decrease over 24 hours, trading at $1.06. This bearish trend is analyzed as a result of risk-off sentiment ahead of the U.S. Federal Reserve's (Fed) interest rate decision and a broader sell-off in the cryptocurrency market, rather than individual negative news.

On the 28th, Bitcoin (BTC)'s sharp drop led to the liquidation of over $700 million in leveraged positions in the cryptocurrency market, most of which were long positions betting on price increases. As XRP fell below its key support level of $1.054, forced selling occurred in a chain reaction, expanding the decline. If the overall open interest decreases in the future, further selling pressure may ease along with reduced leverage.

Macroeconomic and regulatory uncertainties also pressured investor sentiment. BTC fell by 1.13% due to investors' risk reduction moves ahead of the Fed's July 29 interest rate decision and the sharp decline in Asian stock markets, including Korea's KOSPI. The U.S. Senate's postponement of the vote on the U.S. crypto market structure bill, the Clarity Act, also weakened short-term regulatory tailwinds for altcoins.

In the short term, $1.043-$1.05 is considered a critical support zone. If this price range is maintained, a sideways trend could emerge, but if it breaks, there is a risk of falling to $1.01 and then to $0.95. To alleviate bearish pressure, XRP needs to reclaim the recently breached $1.075. The market's attention is focused on the Fed's policy statement and Chairman Kevin Warsh's press conference, and unlike the social investor sentiment which maintains moderate optimism, prices are expected to be influenced by the macroeconomic environment for some time.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*