XRP dropped 7.25% on January 18 to $3.05, as traders reacted to unfounded rumors regarding President-elect Donald Trump’s plans to include the cryptocurrency in a proposed US strategic reserve. Earlier in the week, XRP had surged over 45%, approaching its all-time high of $3.55, buoyed by bullish sentiment ahead of Trump's inauguration. The rumors, initially reported, indicated a strategic reserve that would include US-based cryptocurrencies like XRP. However, as no confirmation followed, excitement waned, compounded by reports of a fallout between Trump and Ripple over political donations to Kamala Harris. Meanwhile, XRP's price decline was mirrored by significant liquidations in the derivatives market, with over $17 million in long positions liquidated in just 24 hours. This drop also indicates potential risks of another 30% decline, as market indicators show a bearish divergence, suggesting weakening momentum. Historically, price corrections often gravitate towards the 50-day exponential moving average, currently at approximately $2.28, which is significantly below XRP’s recent highs. The volatility serves as a reminder of the inherent risks within cryptocurrency trading.

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