Grayscale Eyes XRP ETF: Market Surge and Whale Activity Set the Stage for Potential Breakout

Grayscale’s ETF Application

Grayscale Investments applied on January 30, 2025, to convert its XRP Trust into a spot exchange-traded fund (ETF). The aim is to provide a regulated platform for investors to purchase XRP, which has approximately $16.1 million in assets under management. The proposed ETF will primarily hold XRP and have shares that are tradable as regular stocks, thus making it easier for both institutional and retail investors to invest.

Enhanced Accessibility for Investors

In respect to the assets being digital, the custodian shall hold it with a high commitment to rules that hitherto have troubled such products in the past. The Grayscale application comes as crypto ETFs have gained tremendous attention, with other companies trying similar applications. Following the application, XRP has had an upsurge in the markets and is perceived to have mainstream adoption. Approval of this ETF will open easier market access to traditional investors and may impact Ripple Labs' pending legal struggles with the SEC.

Whale Activity and Market Interest

During the last week of January 2025, a huge amount of whale activities in XRP reflected great interest among big whales. On 27th January, a whale moved 29.5 million XRP for approximately $92.7 million to Coinbase. It fueled speculation that maybe he was planning to sell or trade. Through this month, whales were adding up 120 million XRP through dips. That indicated whales had a belief in the asset. Daily trading volume jumped to about $13.6 billion on January 28, an 81% rise, as XRP stayed high of $3. This saw a remarkable price gain of 560 percent from November 2024, leading to the need to ask whether that's sustainable or not.

XRPUSD showed a minor pullback of more than 20% from a minor bottom of $2.65.  It hit a high of $3.21 and is currently trading around $3.075. A daily close below $1.60 could signal a further minor bearish trend. XRP remains below above both short-term (34 EMA and 55 EMA) and above long-term moving averages (200-day EMA) on the 4-hour chart confirming a mixed trend.

Resistance and Support Analysis
The immediate resistance level for XRP is around $3.40, and a breakout above this level will push prices higher to $4. Any breach above $4 confirms further bullishness, a jump to $5. On the downside, immediate support lies at $2.60 any break below targets $2.25/$2.00, $1.60, $1.27, $1.00, $0.85, and $0.74.

CCI(50)- Bearish

Directional Movement Index - Bearish

Trading Strategy Recommendation

It is good to buy on dips around $2.60 with SL around $1.90 with SL around $4.