Is XRP Price Going to Crash Again?

Cryptocurrency

Summary:

XRP could crash 40% by February from bearish technical conditions and signs of growing distribution by whales.

XRP has dropped by 22.25% over a month after hitting $2.90, its highest level since January 2018, and was trading for as low as $2.26 on Jan. 10. Is XRP Price Going to Crash Again?_1

XRP/USD daily price chart. Source: TradingView

Profit-taking due to XRP’s overbought levels, strong US economic data, and the Federal Reserve’s hawkish pivot have been the primary reasons for the price decline.

Let’s examine whether XRP’s price could drop further in the coming days.

XRP symmetrical triangle raises 40% drop potential

XRP price is painting a symmetrical triangle on the daily candle chart, marked by converging trendlines connecting higher lows and lower highs. This pattern typically hints at indecision in the market, with the possibility of a significant price breakout in either direction.

As of Jan. 10, XRP is trading near the triangle’s upper trendline, which, in recent history, has preceded declines toward the lower trendline. In other words, a decline toward $2.05, or the 50-day exponential moving average (50-day EMA; the red wave). Is XRP Price Going to Crash Again?_2

XRP/USD daily price chart. Source: TradingView

A decisive break below the lower trendline could send XRP price further lower toward $1.36, down about 40% from the current price levels, by February.

This downside target is measured after subtracting the triangle’s maximum height from the potential breakdown point at the triangle’s apex near $2.18.

Conversely, a clear break above the triangle’s upper trendline could send XRP toward $3.46, measured by adding the triangle’s maximum height to the potential breakout point at around $2.18.

However, XRP’s market currently favors the bears, primarily due to signs that its richest investors are selling their holdings during the ongoing price consolidation.

As of Jan. 10, XRP’s supply held by addresses with at least 1 million tokens had declined to a new record low of 90.50 billion, according to data resource Messari. In comparison, these entities collectively held 100 billion XRP last year. Is XRP Price Going to Crash Again?_3

XRP in addresses with at least 1M balance. Source: Messari

Can XRP price go as low as $1.50?

On the weekly timeframe chart, XRP has been consolidating inside the $1.98-3.03 price range, aligning with its 1.0 and 1.618 Fibonacci retracement lines.

As of Jan. 10, XRP/USD bounced a week after testing the $1.98 level as support. However, its upside momentum has slowed, with the price declining by around 4% in the current weekly session. Is XRP Price Going to Crash Again?_4

XRP/USD weekly price chart. Source: TradingView

Notably, the cryptocurrency’s weekly relative strength index (RSI) remains above the overbought threshold of 70, underscoring the risk of a deeper correction in the near term.

If the bears prevail, XRP could retest the $1.98 support level in the coming days or weeks.

A decisive break below this level would further increase the likelihood of a drop toward the 20-week EMA (the purple wave), currently near $1.50, a level that served as a correction target during similar overbought conditions in the past. It is right below the 0.786 Fib retracement target at around $1.62.

Conversely, if XRP holds above $1.98 support, the likelihood of a rebound toward $3 is high. This upside target aligns with cryptocurrency and forex trader Valeriya’s bullish outlook for XRP price. Is XRP Price Going to Crash Again?_5

XRP/USDT four-hour price chart. Source: Valeriya

“The XRP price is in the key decision-making zone. The reaction to the level of $2.15–$2.20 will be an indicator of the intentions of major players,” he said, adding:

“If the support zone resists, an aggressive growth is expected with the nearest target of $2.91, where the liquidity of sellers is concentrated. If the level is broken, the market may go for liquidity below $2.00.”

Source: Cointelegraph

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Warren Takunda

Economic

The Pound to Euro exchange rate is down a further half per cent on Thursday, falling to 1.1920, the lowest point since the start of November.

The declines come amidst a widespread fire-sale of the British Pound as foreign exchange markets react to a significant selloff in UK government debt.

The benchmark UK ten-year government bond was sold again on Thursday, driving up its yield (which is effectively the interest rate the government pays to borrow money on a ten-year fixed term).

At 4.839%, the yield is the highest it's been since the turn of the millennium. This means the government must find billions more to simply repay its debt.

In 2022, Prime Minister Liz Truss crashed the bond market by proposing a set of spending and tax changes that investors thought would put the country's economy and finances in jeopardy. However, the proposals were never enacted, and the economy never collapsed. Coincidentally, Truss has sent Prime Minister Keir Starmer a cease-and-desist instruction to stop claiming she crashed the economy.

Pound to Euro Rate Slumps to 1.19 as Ten-year Gilt Yield Hits Millennium Highs_1

Above: The cost of borrowing is at its highest since the turn of the century.

The opposite is true now: it's because the economy is collapsing that the bond market is reacting in the way it is.

Economists say the big tax-borrow-and-spend budget is causing the slowdown she succeeded in passing in October.

Many businesses are shutting doors in early 2025 due to the multi-billion-pound tax raid which will hit in April, while surveys show a rapid slowdown in hiring and collapsing business confidence.

Economists warn the UK's debt dynamics have deteriorated by more than £10BN since the budget, meaning the government will have to enact tax hikes or spending cuts to meet its fiscal rules.

"How much bigger is the UK's debt burden? Based on current market expectations, we expect central government net interest costs to track around GBP 10BN more per annum between 2025/26 and 2029/30 (relative to the Autumn Budget projections)," says economist Sanjay Raja at Deutsche Bank.

Pound to Euro Rate Slumps to 1.19 as Ten-year Gilt Yield Hits Millennium Highs_2

The prospect of higher taxes threatens to drive UK economic growth further into the ground, creating a perpetuating doom loop for the economy.

"There's more to the story too. On 26 March, when the OBR presents its updated economic outlook, a raft of economic changes look inevitable," says Raja.

Deutsche Bank thinks GDP growth will likely be revised lower from its optimistic 2% projection for the current calendar year.

Inflation will be revised higher, adding to debt costs, as a significant portion of UK debt is priced on the Retail Price Index, which is a measure of inflation.

The OBR's unemployment projections will also likely rise further, in line with a string of economic surveys showing businesses will shed jobs in reaction to Rachel Reeve's business tax raid.

"What does this mean for the fiscal outlook? Spending cuts, more borrowing, and likely a little more taxation to close the emerging fiscal hole," says Raja.

Holding UK bonds and the Pound, under such circumstances, looks increasingly unattractive.

The Pound was able to rapidly rebound to the Truss episode as the plans were quickly scrapped. The problem facing Reeves is her plans have been put in motion, and the real-world impact of said plans is only starting to be felt.

Although the British Pound has not fallen by as much as it did under the Truss episode, foreign exchange analysts warn that it is hard to see the currency snapping back to register the outperformance that it registered in 2023 and 2024.

The 2024 highs in Pound-Euro - located at 1.2150, might therefore be firmly behind us. At the very least, it would take months to reclaim such levels.

"A repricing of UK growth prospects helped sterling in 2024 but the upward revision to the UK's outlook has stopped. This argues for EUR/GBP to be range-bound (even dull) despite a sharp move as gilt yields spiked. GBP isn't a currency which goes nowhere. So, if EUR/GBP can’t go down, it seems it has to go up," explains Juckes.

(EUR/GBP = GBP/EUR down!).

Source: Poundsterlinglive

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Warren Takunda

Economic

Global markets face a choppy ride ahead of U.S. inauguration day on Jan. 20, with Britain and the U.S. releasing key inflation data, China publishing growth numbers while earnings on Wall Street and IPOs in Europe get underway.

A selloff in global markets is also unnerving investors, with British markets at the centre of the storm.

Here's what is in store for world markets in the coming week from Kevin Buckland in Tokyo, Saeed Ahmed and Lewis Krauskopf in New York and Anousha Sakoui and Naomi Rovnick in London.

1/ STAGFLATION NATION

Britain's economy is stagnating while inflation has rebounded to an eight-month high, putting the Bank of England in a bind.

As if that's not enough, British gilts are firmly in the crosshairs amid a global bond squeeze. With the pound sinking and 30-year bond yields at their highest in more than a quarter of a century, finance minister Rachel Reeves faces her first major test, potentially forcing her to cut future spending.

Traders expect British interest rates to drop from 4.75% to 4.25% this year, but consumer price data on Jan. 15 will show whether the Labour government's public sector pay rises and tax hikes on employers have made the risks of monetary easing unbearable.

Unless inflation moderates, the chances of the BoE becoming paralysed by uncertainty look set to rise.

This chart depicts the UK's CPI, core CPI, and the Bank of England's policy rate.

2/ INFLATION RAMIFICATIONS

U.S. inflation data will provide a major test for the recent run-up in Treasury yields and investors' tempered expectations for Fed rate cuts this year.

The December consumer price index, due on Wednesday, is expected to show a 0.3% monthly rise, according to a Reuters poll, following a similar rise in the CPI in the prior month.

For investors, the pace of inflation is one of the main risk factors. At its December meeting, the Fed projected only two rate cuts this year, as it braced for higher inflation than it previously estimated. Market expectations are baking in about 40 basis points of easing in 2025.

A hot inflation number could further lift Treasury yields, whose swift ascent in recent weeks has rattled asset prices.

Chart shows the monthly change of CPI inflation in the U.S. in 2024.

3/ THE ART OF TRADE WAR

Jan. 17 is expected to confirm that China's stimulus-fuelled fight against deflationary forces allowed it to achieve its 5% growth target for 2024.

But there is no time to celebrate, with a much bigger battle looming, and Beijing is already erecting defences. Donald Trump's return to the White House on Jan. 20 could mean a threat of 60% tariffs on Chinese imports becoming a reality.

The People's Bank of China announced the sale of an unprecedented 60 billion yuan ($8.18 billion) worth of six-month yuan bills in Hong Kong. That will drain liquidity to protect the currency just ahead of Trump's inauguration, although gaping yield differentials with the U.S. will keep pressure on the currency - already at 16-month lows. Take Five: The Week Before Next_3

4/ BANKING ON EARNINGS

Robust investment banking fees, strong trading income and easing pressure to boost deposit rates should make for a happy earnings season for U.S. banks.

Higher deal volumes and strong underwriting of bonds have helped lift revenue from investment banking fees in the fourth-quarter by 26% year-on-year, Dealogic data shows. Trading revenues hit record volumes of $224.6 billion last year, according to research firm Coalition Greenwich.

Much scrutiny will be on the outlook for net interest income (NII) - the difference between what banks earn from loans and what they pay for deposits.

JPMorgan , Wells Fargo, Citigroup and Goldman Sachs will kick off earnings on Wednesday, while Bank of America and Morgan Stanleyreport results on Thursday.

The chart shows the sector wise earning growth expectation for Q4 2024 for S&P 500 companies .Financial firms growth are expected to almost double the broader market index

5/ GEARING UP FOR A DEBUT

Companies in Europe are gearing up to go public.

Spanish travel technology group HBX Group, whose brands include Hotelbeds, which is eyeing a 1 billion euro ($1.03 billion) offering in the coming week. German drug manufacturer Stada - potentially valued at 10 billion euros - and fast fashion retailer Shein are among those expected to follow suit in the first half of the year.

Prospects for European issuers have turned fairer as Deutsche Bank and Citigroup analysts turn bullish on European stocks for 2025.

Last year was a mixed bag: 101 European company IPOs raised $19.3 billion - 18% more than in 2023. But that is seven fewer transactions than in the previous year, LSEG data shows. Take Five: The Week Before Next_5

Source: Reuters

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Warren Takunda

Economic

Yields on UK government bonds have soared to levels not seen in decades, with 10-year gilts reaching 4.90% on Thursday - the highest since July 2008 - and 30-year yields climbing to 5.40%, a peak last recorded in August 1998. The pound also tumbled to a 14-month low against the dollar, falling below $1.23.

While some draw parallels to the market panic during Liz Truss's short-lived premiership, analysts remain divided on whether this episode signals a broader crisis or a passing storm.

In a note shared Thursday, BBVA analyst Alejandro Cuadrado said: "Capital flows are flowing out of the UK, pushing bond yields higher and the pound lower. The current situation could become a 'mini Truss moment' if fiscal concerns persist." UK Bond Yields Soar to Multi-Decade Highs: Is It a New 'Truss Moment'?_1

UK Bond Yields Soar to Multi-Decade Highs: Is It a New 'Truss Moment'?_1

What is driving the UK bond market sell-off?

The UK bond market is under pressure from a mix of global and domestic factors.

Rising inflation, increased fiscal spending, and a global bond sell-off have all contributed to higher yields.

The 30-year gilt, in particular, has been hit hard, reflecting investor concerns about long-term inflationary risks and the sustainability of the UK's public finances.

Additionally, the British pound has come under significant pressure, falling below $1.23 to hit a 14-month low against the dollar.

ING Group analyst Chris Turner said: "The gilt market has proved to be the Achilles' heel for long sterling positions. The recent widening of gilt spreads prompted investors to cut back on overweight sterling trades."

The global backdrop also plays a key role.

Across the Atlantic, US Treasury yields have risen sharply as markets digest the incoming administration of Donald Trump. His pledges to impose sweeping tariffs and implement tax cuts have raised fears of inflationary pressures and surging deficits.

The situation in the UK is also tied to developments in the United States, where Treasury yields have surged as markets digest the incoming administration of Donald Trump.

His pledges to raise universal tariffs - up to 60% for China and 10–20% for other countries - and implement sweeping tax cuts have stoked fears of inflationary pressures and surging deficits.

The 30-year US Treasury yield, at 4.95%, is hovering near its highest levels since 2007.

Is this another 'Truss moment'?

The rise in UK gilt yields has inevitably drawn comparisons to the "Truss moment" of September 2022, when unfunded tax cuts during Liz Truss's brief premiership triggered a sharp sell-off in gilts and forced the Bank of England (BoE) to intervene.

However, this time, the situation differs in several key respects.

While the rapid rise in yields has raised alarms, analysts believe the market stress is less acute.

"Unlike the Truss turmoil, today's move is more gradual, which should prevent a spiral higher in gilt yields", said Turner.

"Demand from foreign buyers remains strong, reducing the risk of a repeat of 2022's liquidity crunch among pension funds."

That said, some underlying factors remain similar. Sticky inflation and government spending continue to weigh on investor sentiment, while Fitch Ratings recently flagged "significant uncertainty" in the UK housing market, adding to market jitters.

Global bond stress: Why is the eurozone holding up?

While the UK and US bond markets have been hit hard, the eurozone has largely avoided similar turmoil.

German bund yields have risen but remain within their two-year range, while Italian and Spanish bond yields have seen little movement.

French yields, however, have climbed to their highest levels since October 2023, reflecting some pressure. UK Bond Yields Soar to Multi-Decade Highs: Is It a New 'Truss Moment'?_2

UK Bond Yields Soar to Multi-Decade Highs: Is It a New 'Truss Moment'?_2

For now, the eurozone remains insulated from global bond market tensions, thanks in part to more subdued inflationary pressures and expectations of slower economic growth in 2025 which could give the European Central Bank a leeway to cut interest rates further.

"The rebound in headline inflation was driven largely by energy, with both the lower base from last year and recent euro weakness contributing to higher petrol prices", said Bill Diviney, an analyst at ABN Amro. However, Diviney added: "We expect headline inflation to resume its fall from February as energy base effects fade, with the 2% target expected to be reached sustainably by April."

ABN Amro anticipates further rate cuts from the European Central Bank (ECB), including a 25-basis-point cut at the Governing Council's 30 January meeting, which would lower the deposit rate to 2.75%.

What's next for Sterling and gilt yields?

The pound remains vulnerable as investors reassess its trajectory, with ING analysts pointing to a strong dollar driven by the Trump administration’s economic agenda. While GBP/USD could dip further to $1.2250, a fall to $1.20 seems less likely.

The BoE, meanwhile, faces a challenging balancing act. Markets are pricing in three 25-basis-point rate cuts by year-end, with December's SONIA forward suggesting a terminal rate of 4%. Sticky inflation, however, complicates the case for monetary easing.

Looking ahead, analysts see limited room for additional increases in gilt yields.

"Sticky inflation, government spending, and higher US rates will keep upward pressure on UK rates", said Turner. "However, the underlying fundamentals suggest that steep sell-offs on sovereign risk are unlikely."

Source: Euronews

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Owen Li

Forex

At the start of the current trading week, there was a sharp pullback in major currency pairs. GBP/USD climbed to 1.2580, EUR/USD tested 1.0400 as resistance, and USD/CAD temporarily dropped below 1.4200. However, dollar sellers failed to fully capitalise on this movement, and the pairs have so far been unable to maintain their recent levels.

USD/CAD

The USD/CAD rally observed since mid-September paused following another test of the 1.4470 level. On the daily timeframe, a reversal pattern, the “double top,” was formed, and its partial completion concluded after the pair dropped to 1.4280. Currently, the pair is trading above 1.4350. With the right fundamental catalyst, the price could retest the 1.4470–1.4450 range. Conversely, if USD/CAD falls below the recent low of 1.4270, a further decline toward the 1.4200–1.4170 range may follow.

Key events that could influence USD/CAD dynamics today include:

16:30 (GMT+2): Average hourly earnings in the US
16:30: US non-farm payrolls
16:30: Canadian unemployment rate
16:30: Canadian employment change

EUR/USD

As expected, after updating last year’s low, EUR/USD managed to correct toward the 1.0430–1.0400 range. However, a more significant recovery failed to materialise, and the pair is currently testing the 1.0300 level as support. Depending on today’s employment data, the pair may either rise above 1.0430 or retest the recent low at 1.0230.

In addition to US employment data, the following events may affect EUR/USD pricing today:

11:00 (GMT+2): Spanish industrial production
16:00: Germany’s current account balance (non-seasonally adjusted)
18:00: US 5-year inflation expectations index from the University of Michigan

Source: ACTIONFOREX

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Michelle

Economic

Forex

The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, stands firm above the 109.00 mark, or its highest level since November 2022 as traders await the US Nonfarm Payrolls (NFP) report before placing fresh bets.

In the meantime, the prospects for slower rate cuts by the Federal Reserve (Fed), which has been a key factor behind the recent surge in the US Treasury bond yields, continue to act as a tailwind for the buck. Apart from this, concerns about US President-elect Donald Trump's tariff plans, geopolitical risks and a weaker risk tone turn out to be other factors underpinning the safe-haven Greenback.

From a technical perspective, this week's goodish rebound from the 107.55-107.50 resistance-turned-support and the subsequent move up favors bullish traders. Moreover, oscillators on the daily chart are holding in positive territory and are still away from being in the overbought zone. This suggests that the path of least resistance for the index is to the upside and supports prospects for further gains.

That said, it will still be prudent to wait for a move beyond the 109.55 area, or over a two-year peak touched earlier this month, before placing fresh bullish bets. The USD might then accelerate the move-up towards the 110.00 psychological mark. The momentum could extend further towards the 110.50-110.55 region en route to the 111.00 mark and the November 2022 peak, around the 111.15 zone.

On the flip side, the 108.75 region could offer some support, below which the index could accelerate the fall towards the 108.15 area en route to the 108.00 mark and the 107.55 horizontal zone. Some follow-through selling below the latter should pave the way for a deeper corrective decline and drag the USD below the 107.00 round figure, towards testing the next relevant support near mid-106.00s.

DXY daily chart

Source: FXSTREET

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Warren Takunda

Stocks

London stocks were set to nudge lower at the open on Friday following a downbeat session in Asia and as investors eyed the release of the latest US non-farm payrolls report.

The FTSE 100 was called to open down around six points.

On the macro front, there are no major UK data releases due, but in the US the non-farm payrolls report for November is scheduled for release at 1330 GMT, along with the unemployment rate and average earnings.

Kathleeen Brooks, research director at XTB, said: "The December payrolls report is expected to show a sharp reduction in jobs growth at the end of 2024. Analysts are expecting a 165k increase in payrolls, this compares to a 227k increase for November. Private sector payrolls are also expected to moderate and grow by 140k, versus 194k in November. The unemployment rate is expected to remain steady at 4.2%, the highest level since August, and average hourly earnings are expected to stay at a 4% annual rate.

"Although jobs growth is expected to moderate, there are still pockets of strength in the labour market that could be inflationary. This is why the average earnings data is also a vital piece of information for this report. Monthly average hourly earnings data has been trending higher in recent months, compared with earlier in 2024. Although annual wage growth has been stable, the monthly figure could suggest that there is upward pressure brewing for wage inflation down the line.

"A moderation in jobs growth, yet elevated monthly inflation growth could make this report hard to decipher. On the one hand a softening labour market supports further easing from the Federal Reserve, on the other hand, stronger wage growth supports a high bar for future cuts."

In UK corporate news, supermarket chain Sainsbury’s posted a 3.8% rise in sales over the Christmas period and said it expected to deliver full-year underlying retail operating profit at the mid-point of its £1.01bn - £1.06bn guidance range, representing growth of around 7%.

Party food sales were up nearly 40% in the six weeks to 4 January, with more than 200 bottles of fizz sold every minute in the key days ahead of Christmas, the company said in a trading statement.

Vodafone said it has raised its stake in its Indian joint venture Vodafone Idea (Vi) after exiting its investment in the country’s mobile tower installation company Indus Towers.

The company said it had sold its remaining 3% shareholding in Indus Towers for 28bn INR ($330m), with $105m used to repay outstanding borrowings secured against its Indian assets and the $225m used to acquire 1.7bn shares in Vi, raising its stake to 24.39% from 22.56%.

GSK said the US FDA has accepted its regulatory application for a new prefilled syringe presentation of Shingrix, its shingles vaccine, eliminating the need for reconstitution before administration.

The FTSE 100 pharmaceuticals firm said the new presentation contained the same composition as the existing vaccine and was supported by data demonstrating comparability.

It marked a significant milestone for Shingrix, which has been approved in the US since 2017 for adults over 50 and since 2021 for immunocompromised adults aged 18 and older.

Source: Sharecast

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Is XRP Price Going to Crash Again?

XRP/USD daily price chart. Source: TradingView

XRP symmetrical triangle raises 40% drop potential

XRP/USD daily price chart. Source: TradingView

XRP in addresses with at least 1M balance. Source: Messari

Can XRP price go as low as $1.50?

XRP/USD weekly price chart. Source: TradingView

XRP/USDT four-hour price chart. Source: Valeriya

Source: Cointelegraph

Pound to Euro Rate Slumps to 1.19 as Ten-year Gilt Yield Hits Millennium Highs

Above: The cost of borrowing is at its highest since the turn of the century.

Source: Poundsterlinglive

Take Five: The Week Before Next

1/ STAGFLATION NATION

This chart depicts the UK's CPI, core CPI, and the Bank of England's policy rate.

2/ INFLATION RAMIFICATIONS

Chart shows the monthly change of CPI inflation in the U.S. in 2024.

3/ THE ART OF TRADE WAR

4/ BANKING ON EARNINGS

The chart shows the sector wise earning growth expectation for Q4 2024 for S&P 500 companies .Financial firms growth are expected to almost double the broader market index

5/ GEARING UP FOR A DEBUT

Source: Reuters

UK Bond Yields Soar to Multi-Decade Highs: Is It a New 'Truss Moment'?

What is driving the UK bond market sell-off?

Is this another 'Truss moment'?

Global bond stress: Why is the eurozone holding up?

What's next for Sterling and gilt yields?

Source: Euronews

Dollar Resumes Its Rally after a Correction

USD/CAD

EUR/USD

Source: ACTIONFOREX

US Dollar Index Price Forecast: Sits Near Two-Year Peak, Above 109.00 Ahead of US NFP

Source: FXSTREET

London Pre-Open: Stocks to Nudge Down Ahead of Payrolls

Source: Sharecast

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