XRP jumps 14% to $1.40 as death cross erasure rides rally

XRP closed above both its 50-day and 200-day EMAs for the first time since its death cross formed — but the averages have not crossed back, and the rally is riding borrowed momentum from a Bitcoin short squeeze.

XRP rose 14.21% to $1.40 on Aug. 21, closing above both its 50-day and 200-day EMAs for the first time since the death cross formed. The 24-hour gain made XRP the best performer among the top 10 cryptocurrencies by market cap, ahead of Bitcoin's 7.44% and Ethereum's 4.50%.

Analysts at CryptoQuant, Nansen, and Lo:Tech warned this week that the short-squeeze fuel is largely spent and the next leg needs to come from actual buyers, not forced covering. More than $3 billion in short positions were liquidated across all assets in five days as Bitcoin punched through $72,000 and reached $79,000 on Friday.

The correlation between XRP's daily return and Bitcoin's daily return this week exceeded 0.85, meaning XRP's move was largely a beta play on the BTC rally rather than an independent repricing of XRP fundamentals. XRP opened the day at $1.2681, hit an intraday high of $1.43, and settled near $1.40.

The death cross erasure is real but incomplete. The 50-day EMA is still below the 200-day EMA — the lines have not crossed back into a golden cross. For that to happen, XRP needs sustained price strength over additional days or weeks. The next test comes Sept. 15, when the Senate is scheduled to revisit the CLARITY Act, with prediction markets currently pricing a 75% probability the bill stalls.

What Thursday's candle actually showed

The critical feature of Thursday's candle is that it closed above both the 50-day and 200-day EMAs, the first time that has happened since the death cross formed. Previous rally attempts had either tagged one average and failed or pushed briefly above both on an intraday basis without holding into the close.

A daily close above both averages is a necessary condition for the death cross to reverse, but it is not sufficient. The death cross itself is defined by the relationship between the two averages, not between price and the averages. A golden cross, the bullish reversal, requires the 50-day to cross above the 200-day, which has not happened.

Historical breakouts that failed

XRP has reclaimed both its 50-day and 200-day EMAs and then failed to sustain the move at least three times since 2021. In September 2021, the move lasted 11 trading days before XRP dropped back below the 200-day. In March 2024, the breakout held for six trading days before XRP rolled over. In January 2025, the move lasted four trading days before a broader selloff pulled XRP back below the 200-day.

The common feature across all three failures is that the breakout was driven by an external event rather than sustained XRP-specific demand. When the event faded, XRP reverted. The current breakout shares this characteristic: the driver is a Bitcoin short squeeze, not an XRP-specific development.

The on-chain and derivatives picture

On-chain data adds nuance. Exchange deposits of XRP hit their lowest level since 2021 this week, meaning holders are moving tokens off exchanges and into private wallets. Wallets holding more than 1 million XRP added approximately 380 million tokens in the past seven days, consistent with whale accumulation that predates Thursday's breakout.

XRP funding rates on major perpetual futures venues turned sharply positive this week, reaching levels not seen since the January 2025 breakout attempt. The shift from negative to positive funding happened over approximately 36 hours, unusually fast and consistent with a short squeeze rather than a gradual build of long interest.

The Relative Strength Index sat at approximately 72 on the daily chart after Thursday's close, above the 70 threshold conventionally considered overbought. The MACD line crossed above its signal line earlier this week, a bullish confirmation, but the MACD also confirmed the moves in September 2021, March 2024, and January 2025 — all of which failed.

What would prove the bullish thesis wrong

Three observable conditions would invalidate the breakout. First, a daily close below the 200-day EMA within the next five trading days. Second, Bitcoin failing to hold above $72,000. Third, a sharp decline in spot volume on Binance and Upbit without a compensating increase on U.S. exchanges.

If all three conditions materialize within 10 days, the death cross erasure was a false signal and the prior bearish structure reasserts itself. Resistance sits at $1.43 (Thursday's high), then $1.60 near the top of the descending channel that has capped XRP since late 2025. Support sits at $1.34, then the golden zone between $1.0754 and $1.0965, with $0.9862 as the deeper floor.

The CLARITY Act timeline differentiates the current setup from previous breakout attempts. Congress returns in September with a procedural vote scheduled for Sept. 15. If the bill advances, Ripple's regulatory standing improves because the CLARITY Act would create clear rules for which tokens are securities and which are commodities. If the bill stalls, which prediction markets currently consider the more likely outcome at 75% probability, the price must find support from other sources.

This article is for informational purposes only and does not constitute investment advice.