Ripple (XRP) price is down by 4.32% today, July 8, to trade at $1.07 at the time of writing. The ongoing drop comes as investors rush to sell off risk assets after President Donald Trump said that the ceasefire between the US and Iran is over.
The 4% drop in XRP price because of escalating geopolitical tensions has caused $8.61 million in long liquidations per Coinglass data. This is the highest long liquidation seen by XRP since June 25.
Risk Assets Tumble as Trump Calls End to US-Iran Ceasefire
President Trump attended the NATO Summit in Ankara, and while there, he slammed Iran’s leaders and negotiators for not being truthful with the press about the negotiations that have taken place so far since the US and Iran signed a ceasefire deal on June 17.
“To me, I think it’s over. I don’t want to deal with them anymore. They’re scum… They’re led by sick people,” Trump said.
Trump’s statement comes after the US struck 80 targets in Iran on July 7 as a response to Iran attacking commercial ships at the Strait of Hormuz.
Trump has also reimposed oil sanctions on Iran. The oil sanctions had been removed on June 17 when the two countries agreed on a 60-day ceasefire that was to end on August 16.
The ongoing situation has pushed the price of oil to the June 24 high of $74. But while oil is rising, the price of XRP is dropping as traders become concerned that the geopolitical tensions are going to cause a sell-off across the crypto market.
XRP Price as Bears Defend 20-Day EMA Resistance
The price of XRP has moved below the 20-day EMA of $1.11, suggesting that the short-term trend is favoring bears.
If the sell-off caused by the escalating geopolitical tensions continues, the price could drop to the June 30 low of $1.03.
The AO bars that have turned red suggest that bears have a good grip. Hence, XRP price could retest $1.03 if buyers remain hesitant. If XRP moves below the June 30 low of $1.03, it could retest the psychological support of $1.
Conversely, if the ongoing drop attracts buyers the same way that it did on July 1, and XRP closes above the 20-day EMA of $1.11. It will suggest that bears are losing their grip.
Closing above the 20-day EMA for three straight days could kickstart the next bullish leg, where the price could reclaim the July 4 high of $1.18.
Institutional Demand Fades Despite Regulatory Win
CoinGape reported that Ripple obtained a license in Luxembourg on July 5 that enabled it to become fully compliant with Europe’s MiCA laws.
But this regulatory win has not increased demand for XRP by institutions because spot XRP ETFs had zero inflows on July 6 and July 7 as price dropped.
Data from the CME also shows that XRP futures products had 635 contracts traded on July 7. These are the lowest volume numbers that the XRP futures have seen since June 12.
The lack of inflows to XRP ETFs and weak demand for XRP futures on the CME suggest that institutional investors are hesitating to buy XRP, as the situation between the US and Iran escalates.