Ripple’s stablecoin, RLUSD, has just surpassed a $2 billion market capitalization. Of the total circulating supply, approximately $1 billion was minted exclusively on the XRP Ledger (XRPL). Opting for this native network means the new supply does not rely on Ethereum or other layer-1 blockchains.
The new milestone immediately positions RLUSD as a serious contender in the cryptocurrency industry. Its emergence begins chipping away at a global stablecoin market that has been heavily dominated by USDT and USDC for years.
The expansion of RLUSD’s supply coincides with strong price momentum for its native token. Over the past week, XRP staged a sharp rally between 46% and 55%. The token advanced from the $1.00 mark in early August, climbing toward a peak of $1.5505. This rapid ascent propelled XRP’s market capitalization to $91 billion at the peak of this week’s rally.
Currently, buying momentum has started to ease slightly. XRP is trading down around $1.4554, entering a routine consolidation phase following the aggressive upward move.
Strong Trend or Just a Rebound?
For technical chart analysts, XRP’s recent price action appears to have solid backing. The Average Directional Index (ADX) - an indicator used to measure trend strength - currently sits at 44.8. A reading this high confirms that the prevailing upward trend is supported by genuine volume, rather than just a weak price bounce.
However, the aggressive surge has pushed other metrics into high-risk territory. XRP’s Relative Strength Index (RSI) stands at 76.8. Hovering well above the 70 mark, this provides a clear signal that the rally has overheated and entered overbought territory.
Bull Trap Risk Behind the Euphoria
The most critical hurdle for XRP traders right now lies in the moving average configuration. A death cross formation - where the 50-day Exponential Moving Average (EMA) remains below the 200-day EMA - is still active on the chart. This medium-term indicator has yet to cross back above the longer-term line despite the token’s surging price.
The combination of an overbought RSI and an unresolved death cross creates notable vulnerability. If buyer pressure wanes and the price fails to reclaim the $1.55 resistance level, this week’s surge could reverse into a bull trap, risking losses for investors who entered late near local highs.
Ripple’s strategy of concentrating RLUSD minting on its own network underscores its ambitions in the stablecoin sector. However, for those trading XRP today, technical indicators deliver a straightforward message: stepping aside temporarily may be the most rational choice as market momentum overheats.
Reported via @Cointelegraph on X.
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Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
