Key Moments
- XRP has fallen nearly 7% this week, trading near a key support area after three straight daily declines.
- XLM is hovering around its 50-day EMA at $0.199, with a failure to hold this band risking a deeper retracement.
- Negative funding rates, a firmer US Dollar, higher Treasury yields, and geopolitical tensions are weighing on sentiment toward both tokens.
Macro and Derivatives Headwinds Pressure XRP and XLM
Ripple (XRP) and Stellar (XLM) extended their pullbacks on Thursday as weaker derivatives signals combined with challenging macro conditions to dampen demand. Both assets have logged three consecutive daily losses this week and are now trading near important technical zones that may determine whether the current decline accelerates or gives way to a rebound.
Derivatives Positioning Turns Less Supportive
Futures and perpetual swaps data reflect a cooling of optimism among traders. CoinGlass’ long-to-short ratio for Ripple stood at 0.96 on Thursday. A reading below 1 points to a bearish tilt, with more traders positioning for downside than upside. By contrast, Stellar’s long-to-short ratio was 1.09 on the same day, implying a modestly bullish stance among derivatives market participants.
| Asset | Long-to-short ratio (Thursday) | Interpretation |
|---|---|---|
| XRP | 0.96 | Bearish skew (below 1) |
| XLM | 1.09 | Bullish skew (above 1) |
Funding dynamics also turned more negative. The funding rates for XRP and XLM switched below zero on Wednesday and were at -0.0022% and -0.0060% respectively on Thursday. When funding is negative, short positions pay longs, typically signaling that traders expect weaker prices ahead.
Stronger Dollar and Higher Yields Limit Crypto Upside
Macro developments have added further pressure to risk assets such as XRP and XLM. The US Dollar Index (DXY) climbed to an intraday peak of $102.53 on Monday, a level described as last seen in early April 2025, before consolidating around $102.24 on Thursday. At the same time, the 10-year US Treasury yield advanced to a fresh two-decade high near 5.35% on Monday and was holding around 5.30%.
These elevated yield levels increase the relative appeal of traditional fixed-income instruments compared to higher-risk assets, creating a challenging backdrop for altcoins.
Minutes from the September 15-16 Federal Open Market Committee (FOMC) meeting indicated that policymakers unanimously agreed to raise the Federal Funds Rate target range. According to the minutes, most members anticipated that another rate hike by year-end would likely be warranted to counter persistent inflation. This stance lent additional support to US yields and the US Dollar, further constraining upside potential for cryptocurrencies.
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