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It has been a rollercoaster of a week for cryptocurrencies, with traders recording huge losses over the last few days. The week began bearish after a bullish weekend but reversed, with Bitcoin hitting a new all-time high of $124k during the early hours of Thursday.

However, the gain was short-lived as BTC, ETH, XRP, and other major cryptocurrencies dumped massively following the PPI news. XRP was able to hold its strong support zone and could be on its way to rally higher soon.

XRP, the native coin of the Ripple blockchain, lost 5% of its value in the last 24 hours and is now trading at $3.1 per coin.

It was trading around $3.36 on Thursday afternoon but quickly dumped to $3 as the PPI data raised fresh concerns about inflation in the United States.

The U.S. Bureau of Labor Statistics announced on Thursday that the Producer Price Index (PPI) for final demand in the US rose 3.3% on a yearly basis in July. This is far higher than the 2.5% analysts expected and also above June’s 2.4%. 

In addition to that, the annual core PPI rose 3.7% in the same period, up from 2.6% in June.

On a monthly basis, the PPI and the core PPI both went up by 0.9%. These data raised fresh concerns around inflation in the United States and whether the Federal Reserve will cut interest rates in its upcoming September meeting. 

In addition to XRP, Bitcoin also dropped from its all-time high of $124k to trade below $119k while Ether failed to create a new all-time high after surpassing $4,700 on Thursday.

 The XRP/USD 4-hour chart remains bullish despite yesterday’s $437M sell spike that saw XRP retest the $3 support. The support level held as XRP immediately bounced back and is now trading at $3.11 per coin.

The downward-trending Relative Strength Index (RSI), which currently stands at 49, underscores the slump in buying pressure. The MACD lines are also around the neutral zone, indicating a fading bullish momentum.

If the RSI continues to decline, the $3 support might not hold for long, and XRP could drop lower and test support provided by the 50-day Exponential Moving Average (EMA) at $2.92.

Traders will consider reducing exposure to the coin if the MACD line in blue stays below the red signal line. Furthermore, XRP’s red histogram bars below the zero line suggest that a bearish momentum is building.

However, if the market correction ends and the bulls regain full control, XRP could immediately reclaim the $3.3 resistance level before attempting to take out its recent high of $3.66.

The rally depends on the RSI pushing above the neutral 50.

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