Why Is XRP Still Not Rallying Despite Ripple’s $50M Settlement with the SEC?

On May 8, Ripple officially reached a $50 million settlement with the U.S. Securities and Exchange Commission (SEC), effectively ending a years-long legal battle. Following the news, XRP surged nearly 10%, trading around $2.30. However, many investors had expected a stronger breakout—which hasn’t happened. Why?

While the settlement is a significant positive catalyst, the market’s attention remains firmly on Bitcoin. With BTC recently breaking above $104,000, capital and focus have largely shifted away from altcoins like XRP. This is the main reason XRP has not seen a more explosive rally despite strong news backing it.

Technical Analysis and What’s Ahead

On the daily chart, XRP formed a bullish engulfing pattern, signaling the potential continuation of an uptrend. The token has just broken out of a multi-month descending channel, where it previously dropped from $3.40 to $1.60. The recovery from that bottom has been impressive.

If XRP can hold above the channel’s former resistance, the next price targets are $2.70 (the 23.6% Fibonacci level), followed by $3.67 and $4.59. While levels above $4.50 may seem ambitious for now, they are worth watching.

The MACD indicator has remained in bullish territory since early April. Despite some false signals due to recent volatility, overall momentum still favors the bulls. A key confirmation would be XRP flipping the $2.35 resistance into support.

However, if XRP breaks below the $2 support level, a correction could follow, possibly pulling the price back to the $1.79 support zone—an area that previously helped prevent further decline.

Bullish Sentiment Is Growing

According to Coinglass, XRP’s Open Interest (OI) has surged to $4.23 billion, the highest level since early March. There’s still significant room to grow compared to the all-time high of $7.86 billion.

Additionally, the funding rate has spiked to 0.0115%, indicating that more traders are betting on a bullish outcome. This may lead to a leverage-driven rally in the near term.

Ripple’s settlement with the SEC is a long-term positive development for XRP, especially with the SEC agreeing to lift certain restrictions and return most of the escrowed funds. However, for XRP to break through the $3 level and beyond, Bitcoin’s momentum needs to cool down so that investor focus can return to altcoins. When that shift happens, XRP could be primed for a stronger rally.