XRP is currently trading near a major high time frame support zone around the $2 mark, a level that has consistently acted as a strong structural base over recent months. This key support has held price action during multiple corrections, and the market’s reaction this time will likely dictate whether XRP continues its broader bullish trend or faces a deeper pullback.
Rotational Price Action and Key Technical Factors
XRP’s recent price movements have formed a textbook auction cycle, traveling from the value area high near $3.10 down to the value area low close to $2. This rotation coincides with declining volume, often a precursor to increased volatility and potential breakout moves.
Several technical indicators reinforce the significance of this $2 support zone:
- High Time Frame Support at $2: The confluence of the 0.618 Fibonacci retracement level with the value area low creates a major demand zone.
- Liquidity Cluster Below $2: There is resting liquidity just beneath support, which may lead to a liquidity sweep—a common market maker tactic to trap late sellers before a reversal.
- Bullish Falling Wedge Formation: XRP is coiling within a falling wedge pattern, a bullish reversal signal. A breakout from this wedge could propel price toward $4.25, a key resistance level aligned with past bullish rallies.
- RSI Stabilization: The Relative Strength Index is flattening near the 40–50 range, suggesting momentum reset and the potential for upward movement.
- Volume Profile Contraction: A sharp drop in trading volume indicates price compression; an increase in volume near support may trigger the anticipated breakout.
Critical Support and Potential Risks
A vital structural point to watch is XRP’s defense of the $1.59 swing low, which also coincides with historical support and dynamic trendlines. A decisive breach below $1.59 would signal a break in the bullish market structure, raising the risk of a deeper correction.
Conversely, if XRP holds above this level and mounts a strong recovery with increased volume at or just below $2, it would validate a higher low formation and provide a strong foundation for the next leg higher.
Lower Time Frame Clues and Market Profile Insights
On shorter time frames, XRP has formed a clear sequence of higher lows, indicating traders are positioning stops below the $2 region. This cluster creates a liquidity pocket that market makers may sweep to trigger reversals. If the 0.618 Fibonacci golden pocket absorbs a brief dip below $2, followed by a swift reclaim on rising volume, it would be a classic bullish deviation an ideal entry signal for swing traders.
Price Targets and Market Sentiment
Should XRP break out from the falling wedge, initial resistance targets include $2.42 and then the psychological $3 mark. The full measured move from the wedge points to an approximate $4.25 target.
Market sentiment shows early signs of shifting positively. Open interest is rising slightly, while funding rates remain neutral, suggesting a balanced market without extreme leverage on either side. This neutral stance supports a sustainable breakout when volume picks up.
What to Expect Next
XRP is at a pivotal juncture. Traders should watch for:
- A sweep below $2 into the golden pocket, followed by strong volume and a reclaim of the level.
- Confirmation of a breakout from the falling wedge pattern.
- Support holding at $1.59 swing low to maintain bullish structure.
If these conditions are met, XRP could be poised for a significant upward move, potentially reaching $4.25 in the coming weeks. However, failure to defend these levels may lead to a deeper correction.
