Fund inflows plummet to one-tenth in a week! Can XRP hold the $1.40 support line?

▲ XRP ETF/ChatGPT generated image ©

XRP (Ripple) is at a critical juncture, facing intense downward pressure as institutional and individual buying interest simultaneously cools. With a sharp decline in inflows to spot exchange-traded funds (ETFs) and a loss of vitality in the derivatives market, concerns about further declines due to the breakdown of key support levels are gripping the market.

According to investment specialized media FXStreet on April 23 (local time), XRP is struggling to maintain the $1.41 support level amid a broader correction trend in the cryptocurrency market. After encountering resistance and being pushed down from its weekly high of $1.46 on Wednesday, it has continued its decline for two consecutive days, facing the risk of breaking the critical demand zone at $1.40.

The primary reason for this bearish trend is the rapidly cooling demand from institutional investors. According to SoSoValue data, funds flowing into XRP spot ETFs until this Wednesday amounted to only approximately $5.42 million, a stark contrast to last week's $55.39 million. Wednesday's daily inflow also remained at $2.42 million, indicating an urgent need for additional momentum to drive the fund market, which has cumulative inflows of $1.28 billion and net assets of $1.09 billion.

Retail investor sentiment is also showing little sign of recovery. Although the crypto Fear & Greed Index rose from 32 to 46 the previous day, indicating some improvement in investor sentiment, Open Interest in the futures market remains stagnant at around $2.58 billion. According to CoinGlass data, this figure is significantly lower than the $10.94 billion recorded last July when XRP hit an all-time high of $3.66, demonstrating that the disappearance of retail buying interest is undermining bullish prospects.

Technical indicators suggest that XRP is trapped below key Exponential Moving Averages (EMAs). The 50-day EMA at $1.41 is currently acting as immediate resistance, with the 100-day EMA at $1.54 and the 200-day EMA at $1.78 forming a strong downtrend structure above it. While the Moving Average Convergence Divergence (MACD) on the daily chart shows a slight positive, and the Relative Strength Index (RSI) remains neutral at 53, the Money Flow Index (MFI) is near 79, hinting at an overbought condition and suggesting a persistent risk of further selling at higher points.

To escape short-term downward pressure, the market needs to close stably above the daily open price of $1.43. For an upward trend, a breakthrough of $1.54, $1.67, and ultimately $1.78 is necessary to expect a broader recovery. Conversely, the media warned that if support at the 50-day EMA fails and the critical demand zone of $1.40 and the weekly open of $1.39 are also breached, the decline could accelerate further due to the overall bearish structure.

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