XRP faces 2 hurdles as rate-hike odds climb and CLARITY Act stalls

XRP's 3.5% rally faces a more immediate threat from rising rate-hike odds that could reverse gains tied to CLARITY Act optimism.

XRP rose 3.25% to $1.1485 on July 22 as reports that President Donald Trump agreed to the CLARITY Act's stalled ethics provision pushed Polymarket passage odds from 32% to 43%, but rising rate-hike expectations threaten to cap further upside.

"The macro tightening narrative is re-emerging, and that poses a greater near-term risk to XRP than the CLARITY Act optimism," Levi, an analyst tracking crypto markets, said.

Prediction markets on July 22 showed increased odds of a US rate hike, with traders pricing in a 25-basis-point increase at the next Federal Reserve decision. Open interest in XRP futures remains 33% below its July 2025 all-time high of $2.4 billion, according to Coinglass. XRP-linked ETFs saw $6 million in net outflows last week, Santiment data shows, while net inflows to exchanges have started to decelerate — a pattern that historically precedes whale distribution.

The CLARITY Act must pass the Senate before the August 7 recess or risk slipping into next year, leaving XRP without a fresh catalyst. If rate-hike odds continue to rise, XRP could face renewed selling pressure, with key support at $1.03 — the June close that marked the token's weakest monthly momentum reading on record.

Rate-Hike Odds vs. Regulatory Tailwind

The tension between macro headwinds and regulatory progress creates an uncertain near-term outlook for XRP. The token has been one of the worst-performing major cryptocurrencies in 2026, falling from a July 2025 peak of $3.65 to near $1.00 over six consecutive losing months. While Bitcoin pushed back above $64,000 and Ethereum climbed toward $1,850 this month, XRP has barely moved, stuck near $1.08 for weeks.

The CLARITY Act would formally classify XRP as a digital commodity, stripping the regulatory ambiguity that has weighed on institutional demand. The White House, Senator Cynthia Lummis, and Senator Bernie Moreno reportedly reached a deal on the ethics language on July 21, though the precise wording has yet to be revealed and Democratic approval remains uncertain.

Technical Picture Shows Mixed Signals

XRP's daily chart shows a death cross pattern, with the 50-day exponential moving average trading below the 200-day EMA. The Relative Strength Index sits at 58 — technically bullish territory but below the overbought threshold of 70. The Average Directional Index reads 12.3, well below the 25 threshold that marks a confirmed trend, indicating neither bulls nor bears have control.

A daily close above $1.1343 with ADX beginning to rise targets $1.1563 and eventually $1.1843, according to technical analysis. On the downside, a rejection from current levels could pull XRP back to $1.1189 as the first line of defense, with $1.1035 as the next significant support.

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