XRP Price Tests Critical Barrier: Will Bulls Lose Steam?

Bitcoin (BTC) enjoyed a brief sigh of relief yesterday as the US delayed its proposed 25% trade tariffs on Mexico and Canada by a month. However, the US proceeded with its 10% tariffs on China, prompting retaliatory measures from Beijing. The escalation has pushed BTC back below the critical $100,000 price level.

Bitcoin Suffers Amid Trade Wars

After a volatile 24 hours filled with uncertainty surrounding US trade tariffs on Mexico and Canada, BTC experienced a short-lived relief rally to $102,000. This came after US President Donald Trump announced a 30-day delay in imposing tariffs on the two North American nations.

However, today’s implementation of US tariffs on China triggered a sharp downturn, causing BTC to break below the $100,000 level. In response, China’s Ministry of Finance announced new countermeasures.

Starting February 10, China will impose an additional 15% tariff on coal and liquefied natural gas, along with a 10% tariff on agricultural equipment, crude oil, and certain vehicles.

Additionally, Beijing has accused the US of violating World Trade Organization (WTO) regulations with its one-sided tariff policies. The Chinese Ministry of Commerce also stated that it would tighten export controls on key raw materials, including molybdenum, indium, bismuth, tellurium, and tungsten, citing national security concerns.

With trade tensions escalating between the US and China, analysts predict heightened volatility in the crypto market in the coming days. Well-known crypto strategist Michael van de Poppe shared his outlook:

Meanwhile, crypto trader and investor Phoenix suggested that BTC could establish a new trading range amid the ongoing trade war. However, history suggests that heightened tariffs could spell trouble for cryptocurrencies.

Web3 enthusiast merts.eth pointed out in an X post that BTC plummeted 65% in 2018 when Trump first initiated a trade war with China. The effects were not limited to digital assets, as the S&P 500 also dropped 12% in the weeks following the implementation of tariffs.

More Downside For BTC?

As Bitcoin struggles to hold the $100,000 price level, concerns are mounting about another potential breakdown in price. Crypto analyst Ali Martinez recently pointed out that if BTC fails to hold the $97,190 support level, there could be more pain for the top digital asset.

The analyst made another observation about how BTC is currently trading in a bearish flag pattern. At press time, BTC trades at $99,961, up 1% in the past 24 hours.

Ripple’s XRP Ledger has recovered from a network halt that prevented validations from being published for over an hour, Ripple’s chief technology officer confirmed.

Network activity froze at block height 93927174 for 64 minutes before the blockchain was rebooted on Feb. 4 at 10:58 am UTC, XRPL’s explorer page shows.

“It looked like consensus was running but validations were not being published, causing the network to drift apart,” Ripple technology chief David Schwartz said in a Feb. 4 X post.

He added validator operators had to manually intervene to “choose a sane starting point” to build enough consensus to pull the network over to a coordinated ledger stream. Schwartz said that his observations were only preliminary and that Ripple was still investigating the root cause.

Ethereum price started a recovery wave above the $2,550 zone. ETH is showing positive signs but faces many hurdles near the $2,880 level.

• Ethereum started a decent upward move above the $2,550 zone.
• The price is trading below $2,880 and the 100-hourly Simple Moving Average.
• There is a short-term declining channel forming with resistance at $2,800 on the hourly chart of ETH/USD (data feed via Kraken).
• The pair could start a fresh decline if it stays below the $2,880 level.

Ethereum Price Recovery Faces Hurdles

Ethereum price started a recovery wave after it dropped heavily below $2,500, underperforming Bitcoin. ETH tested the $2,120 zone and recently started a recovery wave.

The price was able to surpass the $2,500 and $2,550 resistance levels. It even climbed above the 50% Fib retracement level of the downward move from the $3,402 swing high to the $2,127 swing low. However, the bears are now active near the $2,900 zone.

The price failed to clear the 61.8% Fib retracement level of the downward move from the $3,402 swing high to the $2,127 swing low. There is also a short-term declining channel forming with resistance at $2,800 on the hourly chart of ETH/USD.

Ethereum price is now trading below $2,880 and the 100-hourly Simple Moving Average. On the upside, the price seems to be facing hurdles near the $2,800 level.

The first major resistance is near the $2,880 level. The main resistance is now forming near $2,920. A clear move above the $2,920 resistance might send the price toward the $3,000 resistance. An upside break above the $3,000 resistance might call for more gains in the coming sessions. In the stated case, Ether could rise toward the $3,120 resistance zone or even $3,250 in the near term.

Another Drop In ETH?

If Ethereum fails to clear the $2,880 resistance, it could start another decline. Initial support on the downside is near the $2,640 level. The first major support sits near the $2,550.

A clear move below the $2,550 support might push the price toward the $2,500 support. Any more losses might send the price toward the $2,420 support level in the near term. The next key support sits at $2,350.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is losing momentum in the bullish zone.

Hourly RSI – The RSI for ETH/USD is now below the 50 zone.

Major Support Level – $2,550

Major Resistance Level – $2,880

Donald Trump’s AI and crypto czar David Sacks said that bitcoin is an “excellent store of value,” during an interview with CNBC on Tuesday.

“First, you got bitcoin. It was the first digital currency. It’s the original, it’s the strongest one,” said Sacks. “It’s been around for over a dozen years now. No one’s ever hacked it. No one’s ever cracked the security around it.”

During a news conference earlier Tuesday, Sacks outlined the Trump administration’s agenda on cryptocurrencies. The crypto czar revealed that evaluating a potential bitcoin reserve is one of the top priorities for the administration’s internal working group. A national strategic bitcoin reserve is one of many pro-crypto policies that Trump pushed during his election campaign.

Trump has also supported greater clarity in regulating cryptocurrencies, as he signed an executive order to establish a crypto working group to draft new regulations for crypto assets.

“I was on the Hill today meeting with the leaders of our House and Senate committees for banking and for finance, and they are very committed to moving legislation through the House and the Senate this year in order to provide that clear regulatory framework that the digital assets ecosystem needs to sustain innovation in the United States,” Sacks told CNBC, adding that it could be done in the next six months.

Such movements were matched by a major shift happening in the U.S. Securities and Exchange Commission regarding the agency’s approach to cryptocurrencies.

The agency’s newly created crypto task force is now working on distinguishing which cryptocurrencies are securities, which was an issue overshadowed by the SEC’s years-long “regulation by enforcement” approach under former chair Gary Gensler.

Earlier today, the New York Times also reported that the SEC is moving to scale back its special unit for crypto enforcement actions, relocating some of its lawyers to other departments in the agency.

During his interview with CNBC, Sacks also mentioned that the administration wants to bring stablecoin innovation, currently happening mostly offshore, to the U.S. by allowing the issuance of stablecoins domestically.

“I think the power of stablecoins is that it could extend the dollar's dominance internationally, extend it online digitally, and create potentially trillions of dollars of new demand for our U.S. Treasuries,” Sacks said.

Despite bitcoin being the focus of back-to-back announcements from U.S. authorities, the world’s largest cryptocurrency fell 2.8% to $98,052, struggling to recover much from China’s retaliatory announcement in response to Trump’s tariff proclamation.

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© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Robinhood Markets has suspended Super Bowl betting after receiving a request from the Commodities and Futures Trading Commission to nix its customers’ access to the event contracts.

The halt comes just a day after Robinhood launched the product in partnership with prediction market Kalishi, allowing wagers on the outcome of the Philadelphia Eagles versus Kansas City Chiefs Feb. 9 game in the National Football League’s championship Super Bowl.

In a Feb. 4 announcement, Robinhood said it would suspend the rollout of the Pro Football Championship market as it continues to work with the CFTC to understand its concerns.

Bitcoin price started another decline from the $102,500 zone. BTC is trimming gains and struggling to stay above the $96,500 support zone.

• Bitcoin started a fresh decline below the $100,000 level.
• The price is trading below $99,500 and the 100 hourly Simple moving average.
• There is a new connecting bearish trend line forming with resistance at $99,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair could start another increase if it stays above the $95,500 zone.

Bitcoin Price Dips Below $100,000

Bitcoin price failed to continue higher above the $102,500 zone. It started another decline below the $100,000 zone. BTC gained bearish momentum for a move below the $98,500 and $97,500 levels.

The bears pushed the price below the 50% Fib retracement level of the upward move from the $91,000 swing low to the $102,500 high. The price even tested the $96,500 support zone and is currently consolidating losses. There is also a new connecting bearish trend line forming with resistance at $99,000 on the hourly chart of the BTC/USD pair.

Bitcoin price is now trading below $98,000 and the 100 hourly Simple moving average. On the upside, immediate resistance is near the $98,000 level. The first key resistance is near the $99,000 level.

The next key resistance could be $100,000. A close above the $100,000 resistance might send the price further higher. In the stated case, the price could rise and test the $102,500 resistance level. Any more gains might send the price toward the $103,500 level.

More Losses In BTC?

If Bitcoin fails to rise above the $99,000 resistance zone, it could start a fresh decline. Immediate support on the downside is near the $96,500 level. The first major support is near the $95,500 level or the 61.8% Fib retracement level of the upward move from the $91,000 swing low to the $102,500 high.

The next support is now near the $93,750 zone. Any more losses might send the price toward the $95,500 support in the near term.

Technical indicators:

Hourly MACD – The MACD is now losing pace in the bullish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.

Major Support Levels – $96,500, followed by $95,500.

Major Resistance Levels – $99,000 and $100,000.