Ripple (XRP) Price at Risk as Contractual Ties to US Govt Emerges

XRP Price Insights:

• Ripple (XRP) price has stalled at the $0.58 – $0.59 range, since retreating from the $0.62 area on Jan 11.
• Concerns about Ripple’s affiliation with the US Government have sparked negative sentiment within the XRP community. 
• The Parabolic SAR indicator highlights the resistance level XRP must beat for momentum to flip bullish again. 

A job posting on the Ripple website has sparked negative sentiment within the XRP ecosystem this week. Applicants discovered a line citing that the company was “a federal contractor or subcontractor” to the United States government. 

Is XRP price now at risk of a sudden price downswing? 

Negative Sentiment Spreads Across XRP Markets

Ripple recently ‘declared’ its affiliation with the US Government, sparking negative reactions within the XRP community.  The term ‘federal contractor’ references a business or organization that is currently in a contractual agreement to deliver services to any agency of the United States Government. 

Ripple is not alien to working with government agencies around the world, having secured several CBDC and settlement partnerships with multiple countries. However, the long-drawn out SEC lawsuit over the last two years has particularly strained the XRP community’s relationship with US regulators.

Hence this statement, affirming Ripple’s affiliation with the US government, has triggered negative sentiment within the community. 

This week, on-chain data trail reveals that the overall sentiment within the XRP ecosystem has flipped negative. 

Santiment’s Weighted Sentiment data tracks the social sentiment within a cryptocurrency ecosystem by measuring the number of negative comments a project receives against the negatives.

When the weighted sentiment drops into negative values, it indicate that the majority of discussions surrounding the asset at that period are dominantly negative.

The chart above clearly XRP Weighted Sentiment slid into negative values, reaching a two-year low of -1.58% on Jan. 14 as news about Ripple’s affiliation to the US govt emerged.

If this devolves into a larger scale of market fear, uncertainty and doubt (FUD), XRP price runs the risk of a major bearish downtrend. 

XRP Price Forecast: Will it Revisit $0.50? 

From an on-chain perspective, the dominant negative sentiment within the XRP ecosystem could see XRP price retreat closer to the $0.50 area in the short term.

The Parabolic SAR  technical indicator also affirms this XRP price prediction. When it points below the asset’s current price, it suggests a growing bearish momentum.

Currently, XRP Parabolic SAR indicator dots point toward $0.62 at the time of writing on Jan. 17. Considering that this well above the current price of $0.57, the alignment is a strong indication that the bears are in the control. 

However, the bulls must clear the $0.55 initial psychological support level to validate this bearish thesis.

If they can surmount that buy-wall, XRP price could dip toward $0.50.

On the upside, the bulls could invalidate that prediction if they successfully force a rebound above $0.60.

However, the Parabolic SAR shows that they bears will likely mount a major sell-wall around the $0.62 area. If that resistance proved daunting, XRP price will likely retreat.