XRP Negative Funding Signals Caution

What to Know:

• A prominent crypto trader, Wealth Manager, has announced a bearish outlook on XRP, heightening concerns within the XRP community.
• This development occurs as XRP experiences a significant price drop amidst a broader crypto market downturn led by Bitcoin’s decline.
• The trader’s short position and technical analysis suggest further downside risk for XRP, potentially impacting institutional and high net worth investor sentiment.

XRP is under renewed pressure as a widely followed crypto trader, known as Wealth Manager on X, publicly revealed a bearish stance on the asset. This announcement coincides with XRP revisiting price levels not seen since late 2024, sparking concern among holders. The confluence of technical weakness and negative sentiment raises questions about potential accumulation zones and future price trajectories for XRP.

Holding XRP? A Contrarian View Emerges

Trader @Wealthmanager recently cautioned XRP holders, suggesting that those still invested in the token “should be worried.” This comment gained traction as XRP struggles below critical price levels amid a market-wide pullback. Bitcoin’s recent dip has exerted downward pressure across the cryptocurrency landscape, with XRP among the hardest-hit large-cap assets. Some analysts suggest that the worst may not be over for XRP, despite a substantial decline from its 2025 peak, highlighting the asset’s sensitivity to broader market corrections.

Wealth Manager’s Active XRP Short Position

Following his cautionary statement, Wealth Manager disclosed an active short position on XRP, anticipating a price decline toward the $1 level. He substantiated this claim with a screenshot of his perpetual futures position, revealing a substantial position size with notable unrealized profit. This trade signals a strong conviction that XRP’s current market structure remains weak, reflecting a broader concern about the asset’s ability to sustain upward momentum. The use of leverage further amplifies the potential impact of this short position on XRP’s price dynamics.

Technical Charts Suggest Deeper Downside Risk

The technical chart shared by Wealth Manager underscores XRP’s reversal from its peak, suggesting the possibility of further downside if key support levels fail. This analysis points to a potential price target in the $0.47–$0.50 range, representing a significant drop from current levels. Such a decline would test the resolve of long-term holders and could trigger further selling pressure, potentially exacerbating the asset’s downward trajectory. The highlighted move suggests a potential drop of more than 60% from current levels.

Potential Accumulation Zones Emerge

Despite the prevailing bearish sentiment, some market participants see opportunities for accumulation. Analyst Crypto Patel notes that XRP has entered its first accumulation zone, historically attracting buyers. However, he advises a gradual approach to accumulation, emphasizing that market bottoms often take time to form. This perspective suggests that while near-term weakness may persist, long-term investors could find value in strategically building positions during periods of price consolidation.

Long-Term Outlook Remains Optimistic for Some

While acknowledging the potential for further declines, Crypto Patel maintains a long-term bullish outlook on XRP, envisioning a move toward double-digit prices once the current bearish phase concludes. He argues that buying during deep pullbacks offers a more favorable risk-reward profile compared to chasing prices near market highs. This perspective highlights the importance of considering both short-term market dynamics and long-term growth potential when evaluating investment opportunities in XRP.

The current market environment presents a mixed outlook for XRP, characterized by technical weakness and negative sentiment from prominent traders. While downside risks remain, some analysts see potential accumulation zones and maintain a long-term bullish perspective. Institutional and high net worth investors should carefully weigh these factors and consider a measured approach to XRP exposure, balancing short-term volatility with potential long-term gains.

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Source: Original article