XRP News Today: Bulls Defend $1.0 as ETF Inflows Turn Positive

XRP snapped a three-day losing streak on Friday, February 6, as dip buyers defended the $1.0 psychological support level. However, the token’s longer-term rebound hinges on ETF inflows and the US Senate.

Bitcoin (BTC) and tech stocks led the recovery as market focus shifted from AI-related spending to firms likely to benefit from the planned surge in CAPEX. BTC crucially bounced back from $60,000 to reclaim $70,000, boosting demand for XRP and the broader market.

XRP’s recovery reinforced the bullish medium-term price outlook. The US administration’s push for crypto-friendly legislation, resilient demand for XRP-spot ETFs, and increased XRP utility remain tailwinds.

Below, I will explore the key drivers behind recent price trends, the medium-term (4-8 weeks) outlook, and the technical levels traders should watch.

US Administration Boosts Hopes for Crypto-Friendly Regulations

On February 6, US Treasury Secretary Scott Bessent commented on the progress of the Market Structure Bill, stating:

“Thank you to Senator Cynthia Lummis for your continued efforts in the Senate to advance critical market structure legislation for digital assets. As I said during my testimony, it is vital that the CLARITY Act is signed into law. The digital asset revolution is here, and I’m confident that with leadership from both sides of the aisle, we can get this across the finish line.”

SEC Chair Paul Atkins also remarked on the push to make the US the center of digital asset innovation, saying:

“We are out to harmonize the rules between the SEC and the CFTC, giving clarity and certainty to the innovators and to investors… so that people can develop their products in the United States rather than feel they have to go offshore.”

Recent developments and US regulators’ support for the digital asset space underscored the marked shift in the US stance toward crypto, suggesting increased adoption.

However, stablecoin yields remain the focal point. US banks are pushing for legislation to prevent stablecoin yields, citing concerns over deposit migration to DeFi impacting bank lending and the US economy.

Crucially, representatives from banks will reportedly attend the next White House meeting on stablecoin yields. Crypto in America host and journalist Eleanor Terret stated:

“The next iteration of the White House stablecoin yield discussions between crypto and the banks has been scheduled for Tuesday, a source within the banking industry tells me. The confab will again be staff-level, but this time representatives from the banks themselves will be present, alongside industry trade groups.”

Progress toward an agreement on stablecoin yields would boost XRP demand, given the token’s sensitivity to legislative developments.

XRP-Spot ETF Market Highlights Robust Institutional Demand

While crypto-related legislation remains crucial for XRP’s price outlook, strong demand for spot ETFs also supports the positive medium-term outlook.

The US XRP-spot ETF market saw $23.88 million in net inflows for the reporting week ending February 6, ending a two-week outflow streak. Notably, institutional demand contrasted sharply with the spot market. Despite weekly inflows, XRP faces heavy losses in the week. Notably, the XRP-spot ETF market outperformed the US BTC-spot ETF market, which extended its outflow streak to three weeks.

Spot-ETF flows remain key to price trends. The US XRP-spot ETF market has seen total net inflows of $1.22 billion since trading began in November. Meanwhile, the US BTC-spot ETF market has had $4.7 billion in net outflows over the same period, weighing on BTC and the broader crypto market. (Pending data for Fidelity Wise Origin Bitcoin Fund (FBTC)).

A continued divergence in demand for XRP-spot and BTC-spot ETFs could decouple XRP from BTC, paving the way for new highs.

XRP Price Forecast: Short-, Medium-, and Long-Term Targets

Despite the February 6 rebound, XRP has fallen 9% this week. The pullback supports the negative short-term outlook (1-4 weeks), with a target price of $1.0.

However, robust demand for XRP-spot ETFs, expectations that the Senate will eventually pass the Market Structure Bill, and increased XRP utility continue to support the bullish medium- to long-term price projections:

• Medium-term (4-8 weeks): $2.5.
• Longer-term (8-12 weeks): $3.0.

Key Downside Risks to the Bullish Medium-Term Outlook

Several scenarios could derail the constructive bias. These include:

• A hawkish Bank of Japan, with a higher neutral interest rate (potentially 1.5%-2.5%). Aggressive BoJ rate hikes could narrow US-Japan rate differentials and trigger a yen carry trade unwind, as seen in mid-2024. A yen carry trade unwind would validate the bearish trend reversal.
• Weak US economic indicators and increased US recession risks.
• Delays and/or partisan opposition to the Market Structure Bill.
• Extended periods of XRP-spot ETF net outflows.

These events would weigh on XRP demand, sending XRP toward $1.0 and affirming the bearish short-term outlook.

Technical Analysis: Levels to Watch

XRP rallied 21.11% on Friday, February 6, reversing the previous day’s 19.59% plunge to close at $1.4703. The token outperformed the broader crypto market cap, which climbed 10.72%.

Despite the rebound, XRP remained well below its 50-day and 200-day EMAs, signaling bearish momentum. However, several favorable fundamentals continue to counter bearish technicals, suggesting a bullish medium-term outlook.

Key technical levels to watch include:

• Support levels: $1.0 and then $0.7773.
• 50-day EMA resistance: $1.8637.
• 200-day EMA resistance: $2.2110.
• Resistance levels: $1.50, $2.0, $2.5, and $3.0.

On the daily chart, a break above $1.50 would open the door to testing the 50-day EMA and $2.0. A sustained move through the 50-day EMA and $2.0 would indicate a near-term bullish trend reversal. A bullish trend reversal would pave the way toward $2.2. A breakout above $2.2 would bring the 200-day EMA into play.

Significantly, a sustained move through the EMAs would reinforce the bullish medium-term price targets.

Fundamental Events Driving Near-Term Price Action

Near-term price drivers include:

• XRP-spot ETF flow trends.
• US economic indicators and the Fed’s rate path.
• Crypto-related regulatory developments.
• The Bank of Japan’s neutral rate and policy stance.
• Increased geopolitical tensions.

Bearish Structure Remains Intact with $1.0 as Crucial Support

XRP’s drop below $1.5 underscored bearish sentiment despite avoiding the $1.0 psychological support level. However, a break below the lower trendline would bring the February 6 low of $1.1220 into play. If breached, $1.0 would be the next key support level.

Importantly, a break below $1.0 would reaffirm the bearish short-term outlook and further validate the bearish structure.

Conversely, reclaiming $1.5 would enable the bulls to target $2.0 and the upper trendline. A sustained move through the upper trendline would signal a bullish trend reversal, invalidating the bearish structure, and reaffirming the constructive medium-term bias.

• Short-term (1-4 weeks): $1.0.
• Medium-term (4-8 weeks): $2.5.
• Longer-term (8–12 weeks): target of $3.0.

XRP Outlook Hinged on Crypto Legislation, ETF Flows, and the Fed

Looking ahead, crypto-related regulatory developments remain pivotal for XRP’s price trajectory. The progress of the Market Structure Bill to the full Senate would likely drive buying interest in XRP.

However, geopolitical tensions, US economic indicators, central bank rhetoric, and XRP-spot ETF flow trends will also dictate near-term price moves.

A more dovish Fed policy stance and a lower BoJ neutral rate (potentially 1%-1.25%) would lift sentiment. Increased buying interest in US XRP-spot ETFs and the progress of the Market Structure Bill would support the positive medium-term outlook.

In summary, these factors support a medium-term (4–8 weeks) move to $2.5. The US Senate’s passing the Market Structure Bill would reinforce the longer-term (8–12 weeks) price target of $3.0.

Beyond 12 weeks, these events are likely to drive XRP to its all-time high of $3.66 (Binance). A breakout above $3.66 would support a 6- to 12-month price target of $5.