XRP Struggles as Bollinger Bands Reveal Market Weakness

XRP is currently navigating a volatile market, with Bollinger Bands signaling potential instability in its performance. The cryptocurrency has shown signs of hesitation on the charts, and technical indicators are pointing to a possible reversal as buyers may be approaching overextension.

As observed on the XRP/USDT daily chart, the Bollinger Bands have expanded significantly, hinting at potential movement. When these bands stretch outward, they suggest a higher probability of a trend change. Currently, XRP is trading close to the upper boundary of this technical envelope, often representing a situation where the asset is overbought. Reinforcing this observation, the Relative Strength Index (RSI) sits at 67, placing it near the overbought threshold. This level typically indicates a need for caution among investors as further upward momentum might be limited.

Data from CoinMarketCap shows XRP trading at $2.52, marking a slight dip of 0.66% within the last 24 hours. This minor retracement, coupled with the current positioning on the Bollinger Bands, supports the idea that XRP might be preparing for a pullback or undergoing consolidation before deciding on its next significant move.

Despite these bearish technical cues, there is currently no definitive squeeze on the Bollinger Bands. A squeeze generally signifies a period of low volatility, often preceding explosive market moves. The absence of such a squeeze signals that XRP is not under extreme pressure to shift immediately in either direction, although the likelihood of a slowing upward rally remains present.

Over the past week, XRP has trended in a tight consolidation range, stabilizing around the $2.50 mark — a level acting as a temporary resistance. Although the token recently surpassed this point, its ability to maintain this threshold will be crucial for determining its short-term direction.

Outside the technical landscape, developments within Ripple’s broader ecosystem have also influenced XRP’s outlook. The RLUSD stablecoin, tied to the Ripple network, has not experienced any new minting activity for the past 18 days. This pause puts a temporary hold on liquidity growth expectations in the system. However, a resurgence in RLUSD could positively impact liquidity within the XRP Ledger, offering the potential to drive XRP’s utility and adoption in the long run.

Furthermore, the conclusion of Ripple’s high-profile legal dispute with the U.S. Securities and Exchange Commission (SEC) removes a long-standing cloud over XRP’s future. With regulatory uncertainty minimized, Ripple can now focus on scaling its network, integrating XRP into more financial products, and enhancing ledger-based services — all of which could ultimately influence the token’s performance.

Investors are now closely watching whether XRP can maintain strength above $2.50 or if this level will act as a ceiling capping further growth. While technical trends reflect caution, macro-developments in Ripple’s ecosystem may provide the catalyst needed to shift momentum in XRP’s favor.

Whether the asset breaks down from its current position or finds support in this zone, market watchers agree that XRP is in a pivotal moment with multiple factors converging to shape its trajectory.

Drawing of its historical trend

Source: TradingView via CoinMarketCap

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