XRP has clawed back toward $1.34 after dipping below $1.32, as buyers defended a key support zone following a hotter-than-expected U.S. producer inflation report. The token lost nearly 6% on Thursday before stabilizing, though the broader technical picture remains cautious.
PPI Shock Adds to Macro Headwinds
September's Producer Price Index rose 1.3% month-over-month, far exceeding the 0.5% consensus forecast. Core PPI, which strips out food and energy, climbed 0.7% against a 0.3% expected gain, accelerating from the prior month's 0.2% increase.
The data followed a similarly hot Consumer Price Index reading, reinforcing concerns that inflation is proving sticky and could keep the Federal Reserve on a tighter policy path. Cryptocurrencies initially sold off on the news, but the subsequent rebound suggests buyers are willing to absorb supply near recent lows.
Liquidations and Leverage Dynamics
The volatile session came after roughly $1.7 billion in cryptocurrency liquidations over four days, according to CoinGlass. Much of that was driven by a long squeeze, as falling prices forced leveraged bullish positions to close. The post-PPI reversal then caught short sellers off guard, with more than $300 million in short positions liquidated in the last 24 hours.
These figures cover the entire crypto market, not just XRP, but they illustrate how sharp reversals can inflict losses on both sides of leveraged trading.
ETF Demand Remains Subdued
Despite the price rebound, demand for XRP-linked exchange-traded funds has been lackluster. SoSoValue data shows net inflows of approximately $13 million so far in October. If that pace continues, monthly inflows would total roughly $26 million—a 79% decline from September.
Weak ETF inflows suggest these products are providing limited fresh buying support. A sustained pickup would offer stronger evidence that institutional appetite is recovering alongside the token's price.
On-Chain Signals Offer Some Relief
On-chain data provides a potentially more constructive signal. Santiment reports that XRP transfers into exchanges have declined following a pronounced increase between September 10 and September 27. Lower exchange inflows may indicate fewer tokens are being moved to trading venues for potential sale.
However, the metric does not confirm that selling has ceased or that all deposits are intended for liquidation. It could ease one source of supply pressure, particularly if buyers continue defending nearby support.
Technical Outlook: $1.45 Is the Line in the Sand
The recovery around $1.32 keeps that area central to XRP's near-term outlook. Sustained trading above it would support the possibility that the pullback is finding a floor. Further gains could also pressure remaining short positions, although a larger short squeeze would depend on positioning and follow-through buying.
The more important reversal threshold is $1.45. A sustained move above that level would strengthen the case for a change in trend. The longer-term $1.80 target remains a bullish scenario, not an immediate expectation.
Until XRP clears resistance, downside risk persists. Losing $1.32 again would weaken the rebound and increase the possibility of a retest of $1.25.
This article is for informational purposes only and does not constitute financial advice.
