NFT Project Azuki's Animecoin Debuts at $1.2B FDV Amid Airdrop

Payments-focused cryptocurrency XRP's short-term outlook appears grim as traditional financial giants do not seem interested in looking beyond BTC and ETH, while price action indicates signs of rally fatigue.

On Wednesday, the Chicago Mercantile Exchange (CME) denied its plans to list futures tied to XRP and Solana's SOL token. This swift denial likely indicates that institutions are not ready yet to dabble with tokens other than bitcoin and ether or potential regulatory hurdles. The CME is the preferred venue for institutions to trade futures and options tied to BTC and ETH.

The CME's denial — at least for now — may be particularly concerning for XRP as it undermines the optimism surrounding XRP's prospects under Donald Trump's presidency. XRP surged to $3.4 early this month after Ripple's CEO Brad Garlinghouse met Trump, spurring hopes for positive developments that could accelerate institutional adoption. Analysts had viewed the meeting as a bullish sign for XRP. Ripple uses XRP primarily as a digital currency to facilitate cross-border payments and remittances.

Rally fatigue

As XRP's price surged close to record highs last week, the Mayer Multiple – which compares the spot price to the 200-day simple moving average – failed to reach new highs and remained below its December peak, indicating a bearish divergence.

This divergence signals a weakening bullish momentum and raises the potential for a price drop. Additionally, the MACD histogram, a tool used to identify trend strength and changes, supports this view by printing lower highs above the zero line.

XRP changed hands at $3.05, representing a 4% drop on a 24-hour basis, according to CoinDesk data. Altcoins, in general, are volatile and tend to follow BTC. So, a rally in BTC could lift XRP above its recent high, invalidating the bearish chart signals. Read More: Solana, XRP Jump as Trump Reportedly Mulls 'America-First' Strategic Crypto Reserve, but Experts Suggest Otherwise

World Liberty Financial, the decentralized finance (DeFi) project linked to President Donald Trump, plans to buy more of Tron's TRX token just days after a $2.6 million purchase, according to a person familiar with its plans.

The project will buy an additional $2.65 million of TRX this week, the person said on Thursday, the same day it purchased $9.8 million worth of wrapped bitcoin .

World Liberty Financial now holds $352 million worth of crypto tokens including $181 million of ether , $56 million WBTC, $32 million of staked ether (STETH) and $7.4 million of TRX, Arkham shows.

The purchases come as sales of the project's own WLFI token heads into the final furlong with just 2.4 billion tokens of the total 25 billion still available. It has raised a total of $1.1 billion since the sale went live in September.

The increase in activity has been spurred by the pro-crypto sentiment stemming from the new U.S. administration, with a regulatory overhaul being planned following the exit of Gary Gensler as the Securities and Exchange Commission (SEC) chief.

"I am looking forward to seeing the Trump administration's pro-crypto stance inspire and develop policies and initiatives that will drive innovation and promote financial inclusion, ensuring cryptocurrency becomes accessible to a wider audience,” Tron founder Justin Sun, who purchased $30 million worth of WLFI tokens in November, said in a statement shared with CoinDesk.

XRP is currently navigating a pivotal phase, trading within a well-defined consolidation range of $2.9 to $3.4. This narrow band reflects a balanced struggle between bullish optimism and bearish caution as neither side has yet mustered the strength to trigger a decisive price movement.

Historically, such periods of consolidation are often precursors to significant market shifts, making this a critical moment for XRP enthusiasts and traders alike. A breakout above the upper boundary at $3.4 will probably act as a bullish catalyst, indicating renewed momentum and attracting fresh buying interest.

Such a move may pave the way for XRP to target higher levels, fueling market confidence. However, a breakdown below the $2.9 support could spell trouble, inviting stronger selling pressure. With technical indicators and trading volumes offering mixed signals, all eyes are now on XRP’s price action to see whether it will deliver a breakout or succumb to a bearish reversal.

A Tug-Of-War Between XRP Bulls And Bears

A consolidation phase has emerged within the $2.9 to $3.4 range, showcasing a battle between bullish and bearish forces. The $2.9 level has proven to be a robust support, preventing further declines, while the $3.4 resistance acts as a key barrier to upward momentum. This tug-of-war highlights the indecision in the market, with traders closely watching for a breakout or breakdown to gauge the next significant price direction.

However, technical indicators are offering valuable insights into XRP’s consolidation phase such as the Relative Strength Index (RSI) suggesting a potential bearish breakout below the critical $2.9 support level. The RSI, currently dropping below the 50% threshold, reflects a weakening buying momentum.

If the RSI continues to dip toward oversold territory, it might indicate that bears might be gaining the upper hand, increasing the likelihood of a price drop below $2.9. A breakdown at this support level may trigger negative momentum, pushing the altcoin into a deeper retracement phase.

While consolidation phases often precede significant market moves, the RSI’s negative alignment warns traders to remain cautious as a failure to hold $2.9 could attract more sellers. Monitoring RSI movements alongside other technical indicators will be crucial in anticipating XRP’s next move amidst this uncertain phase.

The Importance Of Defending The $2.9 Support Level

Recent price action shows that the $2.9 support level is a critical threshold for XRP as bearish pressure looms. A decisive break below this level would result in increased selling pressure, driving the price down toward $1.9. This makes defending $2.9 a priority for the bulls since maintaining this level could provide the stability needed for a rebound.

Failure to hold $2.9 might also shake trader confidence, reinforcing pessimistic sentiment and extending XRP’s consolidation phase. It is advisable to monitor price action and volume near this key level as it might determine whether XRP remains resilient or submits to more downside risks.