XRP Weakens: Targets Next Support Level

What to Know:

• XRP’s price has been constrained within a tight range, with sellers appearing near $1.90, increasing focus on the $1.85 support level.
• Recent market behavior shows a preference for short-term risk management over strong directional bets, especially after volatile movements in major cryptocurrencies.
• The near-term direction of XRP depends on whether traders can reclaim and hold the $1.87 level, or if the price will test the $1.860–$1.855 support zone.

XRP has experienced a slight downturn, slipping below short-term support levels as sellers continue to exert pressure around the $1.90 mark. This price action has confined the token within a narrow trading range, prompting increased attention towards the $1.85 support area. The current market climate, characterized by thin liquidity and strategic positioning as the year-end approaches, is contributing to XRP’s struggle to break out. Investors and traders are closely monitoring these levels to gauge potential future movements.

Market Structure and Year-End Positioning

The current crypto market landscape is marked by choppy conditions as we approach the end of the year. Liquidity often diminishes during this period, leading to increased volatility and price swings. Traders are primarily focused on short-term risk control rather than establishing strong directional positions, a strategy influenced by recent unexpected market movements across major cryptocurrencies like Bitcoin and Ethereum. This cautious approach is further compounded by the uncertainty surrounding potential regulatory developments and macroeconomic factors that could impact the broader crypto market. Institutions, too, are likely rebalancing their portfolios, contributing to the subdued trading activity and increased sensitivity to price fluctuations. This environment makes it challenging for assets like XRP to sustain upward momentum.

Divergent Analyst Views on XRP’s Trajectory

The outlook for XRP is clouded by conflicting signals from market analysts, adding to the uncertainty surrounding its price action. Some analysts have identified a rising wedge pattern on XRP’s chart, suggesting a potential downward pressure if support levels continue to weaken. This bearish outlook is countered by others who point to Relative Strength Index (RSI) divergence patterns, which often signal exhaustion points near local lows, hinting at a possible price reversal. This divergence in opinions has created a lack of strong conviction among traders, leading to a tendency to fade rallies near resistance levels. The mixed signals underscore the complexities of technical analysis in the crypto market and the importance of considering multiple indicators when evaluating potential investment opportunities in assets like XRP.

Technical Analysis Indicates Key XRP Levels

A detailed technical analysis reveals that XRP spent a significant portion of a recent trading session using the $1.8615–$1.8700 range as a support zone. However, late-session selling pressure pushed the price below this level, shifting it into a lower distribution range. Notably, volume concentration was observed at resistance, with trading peaking around 75.3 million tokens during a rejection near $1.9061. This volume was nearly double the 24-hour average, indicating that larger players were actively selling into strength rather than accumulating. Intraday data further supports this observation, as the breakdown from approximately $1.878 to the mid-$1.86s occurred with repeated volume spikes, confirming that the downward movement was driven by strong selling pressure rather than mere market drift.

Trading Strategy for XRP in the Current Environment

Given the current market dynamics, the $1.87 level has transitioned from a support to a critical decision point for XRP. If XRP can successfully reclaim this zone and maintain it, it would signal a potential range reset and a possible move back towards the $1.90–$1.91 levels. Conversely, failure to reclaim $1.87 would likely lead traders to focus on the $1.860–$1.855 area, where buyers are expected to provide support to prevent a more significant decline. The prevailing strategy remains to sell rallies near $1.90 and buy dips near $1.86. The next directional move for XRP will likely depend on whether volume expands on a breakout, rather than another low-liquidity probe within the existing range. Monitoring volume activity will be crucial for anticipating the next significant price movement.

The current market pattern for XRP suggests a continuation of range-bound trading until a clear catalyst emerges. Traders should remain vigilant, focusing on key support and resistance levels while monitoring volume for potential breakout signals.

Related: Bitcoin Dips: Market Shows Key Support

Source: Original article