**XRP** has been trading above $2 after a correction from a high of around $2.40 in early January, and analysts note that the U.S. Dollar Index (DXY) is approaching a structural zone historically seen ahead of the token's peak rallies.
What happened; Dollar index pattern
Crypto analyst Bird highlighted three periods on X—2017, 2021, and 2024—sharing a technical analysis that DXY's sustained weakness coincided with aggressive rallies in XRP during those periods.
DXY, or the U.S. Dollar Index, is a metric that measures the value of the U.S. dollar against a basket of six major foreign currencies, including the euro, Japanese yen, and British pound.
This pattern suggests that XRP is reacting more to macro conditions than to token-specific issues.
When dollar dominance weakens, capital tends to rotate into crypto assets.
In the 2017 cycle, XRP rallied to the mid-$3 range during a dollar weakness phase, and in 2020–2021, it surged to $1.90 at the cycle peak. In the first half of 2025, XRP reached its all-time high of $3.65 in July, marking the cycle's conclusion.
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Why it matters; Macro 'decision zone'
Currently, DXY is hovering around 99, and Bird views this level as a 'decision zone' where the market direction will diverge in the near future.
If the index turns bearish and starts recording consecutive daily red candles, historical patterns suggest that conditions may be set for XRP to launch an additional upward rally surpassing $3.65 within a few months. Conversely, if the dollar turns bullish, liquidity conditions could become even tighter, making it likely that XRP will remain confined to a $2 range with limited movement.
Which way the dollar moves forward will determine which scenario unfolds.
Meanwhile, technical analyst ChartNerd pointed out that a so-called 'golden cross' has emerged in XRP's 5-day MACD, where the MACD line has crossed above the signal line.
The histogram has also switched from red to green.
The last time this signal appeared was in July, when XRP rallied to a new all-time high (ATH).
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