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XRP price has staged a strong comeback in the past few days. This made it one of the best-performing tokens in the crypto market.
Ripple has jumped by 30%, bringing its market capitalization moving to over $140 billion. This article explores some of the top reasons why it has jumped this year.
XRP Price Has Soared Because of the Ongoing Crypto Market Rally
The primary reason why the XRP price has rallied is that the crypto market surge has gained steam in the past few days. Bitcoin price has moved to over $93,000.
At the same time, the market capitalization of all tokens soared to over $3.20 trillion. It’s up sharply from last month’s low of $2.7 trillion.
The crypto market rallied because of the January Effect. Financial assets rose at the start of the year. Investors began new portfolio allocations. The rally followed the end of tax-loss harvesting.
This surge also explains why the stock market has jumped. With this, the Dow Jones and the Nasdaq 100 indices are nearing their all-time highs.
At the same time, the Crypto Fear and Greed Index has moved from last month’s low of 10 to 43. It’s a sign that investors are embracing risk again. In the case of XRP, CoinMarketCap data shows that the 24-hour volume jumped to over $7.7 billion. That’s the biggest increase in months.
Investors deployed leverage in their trades in recent days. Futures open interest rose to over $4.6 billion. This level marked the highest since $5.2 billion.
It stood well above last month’s low of $3.2 billion. The chart clearly showed this sharp increase. Traders actively expanded positions as market confidence strengthened.
XRP ETF Inflows Have Soared
The other main reason why the XRP price has surged this year is that American investors have continued to invest in the coin in the past few months. This is a sign of increased accumulation.
SoSoValue data showed that the spot XRP ETF inflows rose to $46 million on Monday. It’s the biggest daily increase since December 22nd.
The inflows have brought the year-to-date additions to nearly $60 million. Total inflow since the inception has jumped to over $1.23 billion, bringing the net assets to $1.65 billion.
The average inflows of November and December were $582 million. As such, if this trend continues, it means that XRP ETF inflows may jump by nearly $7 billion this year alone.
There is a possibility that the total inflows will be much higher than this average, especially if the XRP price rally continues.
XRP Price Formed Bullish Chart Patterns Before The Rebound
The other main reason why the XRP price has surged is that it has made a few bullish chart patterns recently
The chart showed the token found a strong bottom at $1.8177. This marked its lowest level in October, November, and December. This drop resembled a double-bottom pattern, a popular bullish reversal sign.
The chart also shows that the token formed a giant falling wedge pattern. Two downsloping and converging trendlines characterized it. The rebound happened when the two lines neared their convergence.
The token also rebounded after it found strong support at the Weak, Stop & Reverse level of the Murrey Math Lines tool. It is common for a token to rebound when it moves to that support level.
RLUSD Stablecoin Growth
Finally, the XRP price has rebounded as the Ripple USD (RLUSD) stablecoin continues growing. Data shows that the coin’s market capitalization has jumped to over $1.3 billion.
This made it one of the biggest coins in the world. It’s a figure that may continue growing after the passing of the GENIUS Act.
Looking ahead, the token may continue rising in the coming weeks, potentially to the psychological level of $3. It is about 30% above the current level.
