XRP/USD Forecast: Cooling US Inflation Supports Recovery, but Key Resistance Holds

In June, the Consumer Price Index declined from 4.2% to 3.5% year-on-year, while analysts had expected 3.8%. The core indicator fell from 2.9% to 2.6%, compared with the forecast of 2.8%. Thus, price pressures are easing significantly, reducing the need for the US Federal Reserve to tighten monetary policy in the near term. According to the CME FedWatch Tool, traders now estimate the probability of an interest rate increase in September at only 16.0%, compared with 40.0% previously. As a result, assets viewed as alternatives to the US dollar, including digital currencies, strengthened considerably, although the positive momentum still appears fragile. Analysts note that the current decline in US inflation may prove temporary, with consumer prices potentially resuming a significant rise due to higher oil prices caused by escalating geopolitical tensions in the Persian Gulf region. Moreover, even at its current level, the Consumer Price Index remains well above the regulator’s 2.0% target. Speaking before Congress, the new US Federal Reserve Chair, Kevin Warsh, pledged to continue fighting inflation even if this means opposing President Donald Trump. Nevertheless, the possibility of higher borrowing costs by the end of the year remains.

In addition, investors are monitoring the approval of the Digital Asset Market Clarity Act, or CLARITY Act, which is likely to pass the House of Representatives but may face significant obstacles in the Senate. The bill must secure the support of 60 lawmakers, meaning that it cannot pass without the backing of several Democratic senators. However, most members of the Democratic Party remain hostile to the legislation because it does not include so-called ethical provisions prohibiting members of the current administration from profiting from the cryptocurrency sector. Yesterday, Senators Chris Murphy, Jeff Merkley and Chris Van Hollen openly opposed the CLARITY Act because, in their view, it fails to eliminate the US president’s corrupt links to the crypto industry through the family-owned company World Liberty Financial Inc. Therefore, the introduction of clear regulatory rules for digital asset companies may once again be delayed.

A positive development for XRP is Ripple’s completion of the licensing process under the European Union’s MiCA framework. Last week, Luxembourg’s financial regulator granted the company a Crypto-Asset Service Provider licence, or CASP licence, allowing it to offer regulated cryptocurrency services throughout the EU and potentially increasing interest in XRP among European investors.

Nevertheless, these positive developments are not sufficient to reverse the overall negative backdrop affecting the cryptocurrency sector.

Support and Resistance Levels

A month ago, the trading instrument entered the sideways range of 1.1718–1.0200. A breakout above the upper boundary could lead to growth towards 1.3671, the Murray [6/8] level, and 1.4648, the Murray [7/8] level. However, if the price consolidates below 1.0200, a decline towards 0.8789, the Murray [1/8] level, 0.7812, the Murray [0/8] level, and 0.6835, the Murray [–1/8] level, is expected.

Technical indicators do not provide a unified signal. The Bollinger Bands have shifted into horizontal movement, the MACD histogram remains stable in negative territory, while the Stochastic oscillator is moving upwards.

Resistance levels: 1.1718, 1.3671, 1.4648.

Support levels: 1.0200, 0.8789, 0.7812, 0.6835.

XRP/USD Trading Scenarios and Price Forecast

Short positions may be opened below 1.0200 with targets at 0.8789, 0.7812 and 0.6835, and a stop-loss at 1.1000. Implementation period: 5–7 days.

Long positions may be opened above 1.1718 with targets at 1.3671 and 1.4648, and a stop-loss at 1.0600.