invezz.com
Ripple’s $XRP extended its gains on Thursday as improving liquidity conditions supported a broad rally across the cryptocurrency market.
$XRP is trading above $1.1 after surging more than 11% on Wednesday, outperforming Bitcoin over the last 24 hours.
The rally gained momentum after the US Treasury announced an expansion of its debt buyback operations, improving risk appetite and contributing to a large-scale short squeeze across the crypto market.
Treasury buybacks trigger crypto short squeeze
The US Department of the Treasury announced on Wednesday that it would double the size of some buyback operations designed to support liquidity in longer-dated Treasury securities.
According to Reuters, liquidity-support buybacks for longer-dated nominal coupon securities will increase from $2 billion to at least $4 billion per operation.
The announcement eased concerns about liquidity in the Treasury market and encouraged investors to increase their exposure to riskier assets.
Improved market sentiment contributed to a short squeeze across the cryptocurrency market, accelerating gains in $XRP and other digital assets.
CoinGlass data shows that 172,642 traders were liquidated over the past 24 hours, with total crypto liquidations exceeding $3.21 billion.
$XRP recorded $120.71 million in liquidations. Long positions accounted for more than 85% of $XRP liquidations, indicating that leveraged bullish positioning remained elevated despite the broader upward move.
$XRP technical outlook: Recovery holds above 50-day EMA
$XRP trades around $1.14 on Thursday, maintaining its position above the 50-day Exponential Moving Average at $1.076.
However, the token remains below the 100-day EMA at $1.153 and the 200-day EMA at $1.338. These levels represent significant barriers that could limit the recovery.
$XRP has also reclaimed a previously broken descending trendline around $0.995, converting the former resistance level into potential support.
The move suggests that the token is attempting to establish a stronger recovery structure, although buyers must overcome the longer-term moving averages to confirm a sustained bullish reversal.
Momentum indicators support $XRP’s near-term bullish outlook. The Relative Strength Index stands near 63 and is approaching overbought territory, reflecting increased buying pressure.
Meanwhile, the Moving Average Convergence Divergence indicator has moved above its zero line, signaling strengthening bullish momentum.
However, neither indicator confirms that $XRP has overcome its major technical barriers. Immediate resistance sits at the 100-day EMA near $1.153.
A sustained break above this level could allow $XRP to target the horizontal resistance at $1.300, followed by the 200-day EMA at $1.338.
If the rally extends beyond these levels, the longer-term structural resistance at $1.900 could return to focus.
The 50-day EMA at $1.076 provides $XRP’s first significant support level. A decline below this moving average could expose the psychological $1.000 mark and the former descending trendline near $0.995.
Together, these levels form an important demand zone that buyers must defend to preserve the latest rebound.
A decisive move below $0.995 would weaken the short-term bullish outlook and increase the risk of a deeper correction.