XRP price faces volatility amid weakening buying pressure and declining network activity. With a potential death cross forming, will XRP drop below $2 or rebound above key resistance levels? Explore the latest analysis, price predictions, and market factors shaping XRP’s trajectory.
The XRP market is experiencing significant volatility, with prices under pressure as key technical indicators signal potential downside risks. Following a recent 64-minute outage, investor confidence remains subdued.
Meanwhile, XRP’s Chaikin Money Flow (CMF) remains positive but has weakened, and network activity has seen a sharp decline. With a potential death cross forming on its EMA lines, XRP could test lower support levels unless renewed buying pressure pushes it back above key resistance zones.
XRP’s CMF Weakens but Remains Positive
XRP’s Chaikin Money Flow (CMF) currently stands at 0.19, down from 0.26 two days ago. After briefly dipping to -0.22 three days ago, it has since stabilized. This decline suggests a weakening buying pressure, though a positive CMF still indicates capital inflows.
The CMF is a volume-weighted indicator that tracks money flow into or out of an asset. A drop below 0.15 may indicate increasing weakness, while a recovery above 0.25 could signal renewed buying strength.
If XRP consolidates at these levels, price stability could follow. However, if capital inflows continue to decline, further downside risks may emerge.
Declining Network Activity Raises Concerns
XRP’s active addresses have seen a sharp decline, dropping nearly 50% from their December peak. Currently, the 7-day active address count stands at 256,000, down from 407,000 nearly two weeks ago. While this remains high relative to most of 2024, the decline suggests reduced demand and transaction volume.
Active address count is a critical metric as it reflects user engagement and network activity. A sustained decline could indicate waning investor interest, while a rebound might signal renewed enthusiasm for XRP.
XRP Price Prediction: Will It Drop Below $2?
A potential death cross on XRP’s EMA lines suggests bearish momentum may continue. If XRP loses support at $2.32, it could fall to $2.20 or lower. A decline in active addresses and weakening CMF could push XRP below $2, with key support at $1.99. This would confirm a deeper bearish trend, making recovery more difficult.
Conversely, if XRP breaks the $2.60 resistance, it could test $2.82. A further rally could push it above $3, with bullish targets at $3.15 and even $3.40. For this scenario to play out, network activity and buying pressure must improve significantly.
At the time of writing, XRP price is down 3.21% to $2.3868. Previously, XRP’s highest price in 24 hours was $2.5692. XRP’s RSI indicator is also below 40, indicating that bearish potential will indeed occur soon.
XRP’s Market Turmoil: External Factors at Play
XRP’s sharp 15% decline in one day underscores its vulnerability to external influences. The downturn followed bullish predictions from SBI CEO Yoshitaka Kitao but was overshadowed by broader market turbulence.
Bitcoin’s slip below $100,000, driven by geopolitical tensions, exacerbated XRP’s losses, sending it to $2.53.
External forces such as regulatory uncertainty and macroeconomic shifts continue to shape XRP’s price movements. The cryptocurrency’s ability to hold above the $2 threshold will determine its near-term trajectory.
Is XRP’s Future in Jeopardy?
Key Factors Influencing Volatility
1. Regulatory Challenges: XRP’s legal battle with the SEC remains a major source of uncertainty. A favorable resolution could boost investor confidence, while adverse outcomes could dampen enthusiasm.
2. Institutional Adoption: Regulatory clarity and institutional involvement will be key in shaping XRP’s long-term prospects. Governments and financial institutions remain cautious about digital assets.
3. Market Sentiment: Broader cryptocurrency trends, particularly in Bitcoin and Ethereum, could impact XRP’s trajectory.
Potential for Recovery
1. Legal Resolutions: A favorable court ruling could reignite interest in XRP.
2. Technological Innovations: Ripple’s continued investment in cross-border payments and DeFi applications could strengthen XRP’s utility and adoption.
3. ETF Approval: The upcoming ETF upgrade for XRP represents a potential milestone, though its long-term impact remains uncertain.
Technical Analysis: XRP’s Golden Pocket Support
XRP is currently trading at a key Fibonacci retracement level known as the Golden Pocket, which often acts as strong support. According to analysts, this presents a potential buying opportunity. If XRP holds above this level, it could trigger a rally towards $3.43.
Key Buy Levels to Watch
1. $2.50 Support: A primary accumulation zone offering a 6-7% discount from current prices.
2. $2.25 – $2.30: A safer entry point, particularly if Bitcoin remains above $95,000.
3. $1.90 – $2.00: A deep discount level in case of further market declines.
Conclusion: What Lies Ahead for XRP?
XRP remains at a crossroads, facing both significant downside risks and potential for a bullish rebound. Key factors such as regulatory developments, market sentiment, and network activity will determine its trajectory.
While technical indicators point to potential further declines, the Golden Pocket support could offer a strong foundation for a future rally. Investors should monitor these key levels closely and adopt a cautious but strategic approach to XRP trading.
This press release has also been published on VRITIMES
