XRP has seen a significant drop, raising concerns about a potential crash to $0.45. The price decline comes amid global economic concerns and news that Ripple Chairman Chris Larsen has endorsed Vice President Kamala Harris for the upcoming U.S. presidential election.
Ripple Price Drop Amid Economic Uncertainty
On September 6, XRP fell below a crucial support level, mirroring a broader market downturn after a weak Purchasing Managers' Index (PMI) report. Bitcoin also broke its key support level, leading to a broader sell-off in the cryptocurrency market. This has intensified the negative outlook for XRP, which is already facing pressure from other economic factors.
Chris Larsen's Endorsement of Harris: What Does It Mean for XRP?
In a letter shared by CNBC, 88 business leaders, including Ripple Chairman Chris Larsen, endorsed Kamala Harris for president. This move surprised many in the XRP community, as the Biden-Harris administration has been perceived as hostile to cryptocurrencies, largely due to actions by the U.S. Securities and Exchange Commission (SEC).
Although Ripple recently scored a legal victory against the SEC, reducing its penalty from $2 billion to $125 million, Larsen's endorsement could create uncertainty for investors. The Harris endorsement may polarize opinions and potentially drive some investors away, fearing additional regulatory challenges.
Economic Fears and Impact on XRP
The global economy is showing signs of strain, with last week’s PMI report indicating weakening manufacturing and an underwhelming jobs report for August. Additionally, the U.S. Yield Curve has recently "uninverted," signaling a possible recession. In the event of an economic downturn, volatile assets like XRP could face severe price swings, further decreasing liquidity and investor confidence.
Ripple Price Analysis: 7% Downside Risk
Technically, XRP is in a bearish trend, and with its price currently trading below $0.54, a further decline seems likely. The next key support level for XRP is around $0.485, a critical level based on mid-August swing lows. A break below this point could result in XRP dropping to $0.45.
The current price action shows strong bearish momentum, with a small candle body and long upper wicks indicating that sellers are in control. If the $0.485 support fails, XRP could form new lower lows in the coming days. On the upside, XRP could face resistance at the previous support level of $0.540, but a strong bullish reaction is needed to reclaim this level.
Investors may want to wait for a confirmed bounce from the $0.485 level before taking a long position, as a recovery above $0.540 would signal a potential shift in momentum.
In summary, XRP's price faces short-term risks amid market uncertainty and the potential impact of Chris Larsen’s political endorsement, with key support levels to watch closely in the coming days.
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