Is XRP Facing a Sub-$2 Threat?
XRP Price Under Pressure Amid Market Downturn
XRP's value continues to face downward pressure as the broader cryptocurrency market declines. The token has struggled to maintain any recovery momentum in recent days.
Investors are actively accumulating XRP to defend crucial support levels and minimize downside risk.
XRP Holders Reassess Market Position
Market sentiment surrounding XRP remains fragile as liquidation data indicates increased downside risk. The liquidation heatmap shows significant exposure for XRP long traders if prices approach $2.00, with a cluster of long liquidations near $2.02, equating to around $25.4 million in leveraged positions.
Entering this zone could quickly undermine bullish sentiment, triggering forced liquidations and inviting short sellers.
This could shift sentiment to bearish, especially among derivatives traders who have remained optimistic despite XRP's prolonged downtrend.
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Despite short-term weakness, macro indicators suggest improving underlying demand. Exchange position change data shows increased net outflows from exchanges, typically reflecting rising buying pressure as investors transfer XRP to private wallets.
This marks a shift from the previous three months when selling pressure dominated XRP price action. Sustained accumulation could stabilize prices if market conditions don't worsen further.
The transition from distribution to accumulation supports a potential medium-term recovery.
XRP's Potential for Stability
Currently trading near $2.06, XRP maintains a downtrend that has limited recovery for over ten days. The token stays above the $2.03 support level, critical for short-term market structure and trader confidence.
This support has resisted several tests recently, indicating strong investor interest. Continued accumulation is expected to defend $2.03, even if XRP consolidates near this range.
A successful rebound could push prices above $2.10, allowing XRP to break the downtrend and regain momentum.
However, broader market weakness could negate these bullish efforts. A decisive break below $2.03 would expose XRP to a drop below $2.00.
This would invalidate the bullish outlook, trigger approximately $25 million in long liquidations, and potentially drive XRP down to $1.93 under intensified selling pressure.