XRP has reclaimed the $1.30 level after a period of volatility sparked by the US Federal Reserve’s September 16 Federal Open Market Committee (FOMC) decision to increase interest rates by 25 basis points. The central bank moved its policy range to 3.75%-4.00%, marking the first rate hike since 2023, a decision closely watched by cryptocurrency traders given its potential effects on market sentiment and liquidity.
XRP price climbs as shorts exit post-FOMC
Analysts indicate that much of XRP’s initial rebound has been driven by the closing of short positions constructed ahead of the Fed announcement. According to BNC data, XRP quickly recovered to the $1.30 mark following the rate hike and macroeconomic updates that unsettled digital asset markets earlier in the week.
Crypto analyst @CW8900 observed on social media that traders holding bearish bets on XRP started to unwind these positions following the FOMC outcome. This “short covering,” which occurs when traders buy back assets to exit their negative positions, often fuels additional buying momentum in the near term.
Short covering in XRP futures has triggered a surge above $1.30, providing immediate support yet falling short of signaling a broader long-term reversal.
The analyst underscored that the closing of shorts was primarily a reaction to the Fed’s rate move, with the central bank’s messaging remaining relatively hawkish in the wake of persistent inflation concerns.
For XRP, distinguishing between short covering and genuine trend reversal is crucial for traders as the price action stabilizes near resistance.
Fed rate hike maintains pressure on risk assets
The Federal Reserve, led by Chair Kevin Warsh, unanimously approved the quarter-point hike and projected a year-end policy rate of 4.1%. The bank emphasized solid US economic activity and reiterated its commitment to achieving a 2% inflation target.
Chair Warsh described inflation as “too high for too long,” reiterating the bank’s focus on price stability. Updated policy projections suggest an additional rate hike may be possible before 2026 concludes.
Fed officials estimate a median federal funds rate of 4.1% by the end of 2026, reflecting continued tightening in monetary policy.
Major US equity indices declined in response. The S&P 500 fell 1%, the Nasdaq dropped 0.7%, and Treasury yields climbed, signaling broader risk aversion impacting all risk-sensitive assets including cryptocurrencies like XRP.
Ripple, the company behind XRP, provides payment solutions and cross-border transfer technologies built on blockchain networks.
Tighter monetary conditions generally decrease liquidity, dampening appetite for assets such as cryptocurrencies.
Technical analysis: Key XRP pivot and support levels
Technical data from TradingView, as noted by @CW8900, highlight the importance of the $1.2862 Point of Control (POC), a price level where the highest volume was traded within the current range. XRP’s repeated interactions around $1.30 make this price zone critical in chart analysis.
The Relative Strength Index (RSI) for XRP has started to rise after last week’s dip, indicating a pick-up in buying momentum. However, with a current value of 43.82, the RSI is still below its midpoint and above traditional oversold territory. The MACD remains on a sell signal, and the 10-period momentum reading is also negative.
TradingView’s technical signals are mixed: out of all indicators, 13 show “sell,” 10 are “neutral,” and only three flash “buy.” Most of the bearish bias is driven by moving averages, with oscillators presenting a largely neutral outlook.
| Indicator | Status |
|---|---|
| Point of Control (POC) | $1.2862 |
| 14-period RSI | 43.82 |
| MACD | Sell |
| Technical Signals (Sell/Neutral/Buy) | 13 / 10 / 3 |
Mini dictionary: Point of Control (POC) — A technical analysis term from volume profile studies, POC marks the price level where the highest volume of trades occurred within a specified period, often signaling strong areas of support or resistance.
XRP faces resistance from the 10-period EMA at $1.345, the 20-period EMA at $1.347, and the 30-period EMA near $1.325, creating a tight band below the next technical test at approximately $1.35. Classic and Fibonacci pivot calculations both highlight $1.354 as a pivotal resistance zone.
Above $1.35, Camarilla resistance levels are found at $1.445, $1.510, and $1.575, with the Fibonacci first resistance at $1.626. Support is identified at $1.314, $1.249, and $1.184, while classic pivot support sits at $1.011. These levels are used as references rather than targets by active traders.
Higher timeframe analysis highlights key $1 support
A three-month chart review by technical analysts identified strong support for XRP at $1 due to several converging factors: multi-month support, prior lows, previously broken highs, and significant candle closes in this zone.
XRP briefly dipped below $1 in August, touching about $0.98, its lowest price since November 2024, before rebounding. Observers now consider $1 a long-term support marker, while $1.30 operates as both short-term support and resistance.
Market outlook: XRP awaits breakout confirmation
Whether XRP can extend its current rally depends on the ability to clear the resistance cluster between $1.32 and $1.35. Holding above the Point of Control supports the immediate rebound case, but a break below could see prices move back toward $1.25 support.
Meanwhile, the macroeconomic backdrop remains challenging. Federal Reserve projections indicate a sustained elevated policy rate and continued vigilance on inflation, factors that may limit risk asset rallies.
Short covering continues to distinguish the current move from a definitive bullish reversal, with technical signals signaling caution. CoinDesk currently reports XRP at $1.30, a market capitalization near $81.9 billion, and 24-hour trading volume of approximately $2.6 billion.
The outlook for XRP remains dependent on further price movement above resistance, a shift in momentum indicators, and improved sentiment as traders track both technical setups and shifts in the broader macro environment.
