XRP at Crossroads: Fed’s September Decision Could Spark $3.40 Rally or $2.45 Drop

XRP’s price has retested the $2.95 support level amid a broader crypto market selloff, with the altcoin currently trading above $2.97 after a brief dip below $3.00. Despite the short-term weakness, technical indicators suggest bullish momentum remains intact. The Moving Average Convergence Divergence (MACD) lines remain in positive territory, while the Relative Strength Index (RSI) stands at 55, above the neutral 50 threshold, signaling a potential for a reboundXRP test key support below $3 as market opens bearish^[1]. Analysts emphasize that holding the $2.95 support is critical for bulls, as a successful defense could propel XRP toward $3.40 in the medium termXRP Breaks $3: Is It Still Early to Invest or Too Late?^[2].

The Federal Reserve’s upcoming rate decision on September 17 has become a focal point for traders. A rate cut, widely anticipated, could catalyze a broader market rally, benefiting XRP and other major cryptocurrenciesXRP Price Sinks Below $3 — Why You Should Wait Before Buying^[3]. Historical patterns also suggest a potential breakout if XRP maintains its current structure. The token recently broke above a falling wedge pattern, followed by a 2.5% rally before the recent pullbackXRP test key support below $3 as market opens bearish^[1]. A sustained move above $3.00 could trigger renewed buying pressure, with $3.18 and $3.40 as key resistance targetsXRP Breaks $3: Is It Still Early to Invest or Too Late?^[2].

Whale activity, however, has introduced uncertainty. Data from Santiment reveals that wallets holding 10 million to 100 million XRP have reduced their holdings by 470 million tokens in recent days, equivalent to $1.35 billion in valueXRP Price Sinks Below $3 — Why You Should Wait Before Buying^[3]. This distribution has intensified bearish sentiment, with some analysts warning of a potential decline to $2.45 or even below $2.00 if the $2.80 support failsXRP Price Faces September Test Amid Support and Breakout Signals^[4]. The breakdown of a symmetrical triangle pattern on the daily chart further raises concerns, as weak buying volume has hindered a decisive reboundXRP Price Faces September Test Amid Support and Breakout Signals^[4].

Long-term bullish projections remain intact despite these risks. On-chain data shows strong accumulation between $2.70 and $3.00, with the Net Holder Position Change turning positive since August 22XRP revisits $3 support, but data shows bulls still in control^[6]. The Realized Profit/Loss Ratio has also stabilized after a sharp decline in July, indicating that selling pressure has been largely absorbedXRP revisits $3 support, but data shows bulls still in control^[6]. Analysts like XForceGlobal argue that XRP’s current consolidation within a symmetrical triangle could lead to a breakout toward $4, with further upside to $6 if $3.66 is clearedXRP Price Faces September Test Amid Support and Breakout Signals^[4].

Institutional flows have added a layer of optimism. XRP surged past $3.00 amid record trading volumes on September 10, driven by institutional participation. The token’s price climbed from $2.96 to $2.99 within 24 hours, with midday volumes six times the daily averageXRP Breakout Fueled by Institutional Flows Targets $3.60 Mark^[5]. Futures open interest has risen to $7.94 billion, reflecting heightened derivatives positioningXRP Breakout Fueled by Institutional Flows Targets $3.60 Mark^[5]. A breakout above $3.02 could extend targets to $3.60, aligning with Fibonacci extension levelsXRP Breakout Fueled by Institutional Flows Targets $3.60 Mark^[5].

The broader market context remains mixed. While XRP’s price has fallen 10% in the past week, its low adoption rate—only 1 in 5,000 people hold the token—has fueled speculation about untapped growth potentialXRP Breaks $3: Is It Still Early to Invest or Too Late?^[2]. Analysts like Dark Defender predict $4.39 and $5.85 targets if XRP maintains its breakout, aligning with a broader bullish setup ahead of Q4XRP Breaks $3: Is It Still Early to Invest or Too Late?^[2]. Conversely, a failure to hold $2.70 could trigger a deeper correction, with the 100-day and 200-day SMAs at $2.48–$2.60 offering secondary supportXRP Faces Downtrend Amid Risk-Off Sentiment and Weak Onchain Activity^[7].

The coming weeks will be pivotal for XRP’s trajectory. A successful defense of $2.95 and a breakout above $3.00 could reignite bullish momentum, while a breakdown below $2.70 may accelerate the downtrend. With the Fed’s rate decision looming and institutional flows showing strength, the market remains poised for significant volatility.