Could XRP’s Price Have Reached the Bottom? Analyzing Key Metrics

In this article, we explore recent market indicators suggesting that XRP might be on the verge of a recovery.

Key Takeaways

The TD Sequential indicator has printed a macro buy signal, potentially signaling a shift in market momentum.
XRP’s recent breakout from a descending triangle pattern suggests potential upward movement.
Institutional interest is indicated by significant ETF inflows, demonstrating strategic accumulation.
Net outflows from spot exchanges reflect reduced selling pressure.
Rising funding rates indicate growing trader confidence but also suggest some risk.

Is XRP's price done bottoming out? A look at THESE metrics suggest...

Macro Buy Signal Indicates Possible Shift

The bi-weekly TD Sequential recently printed a macro buy signal, which frequently appears at significant turning points in the market. This signal followed months where XRP experienced declining highs and consistent selling pressure. Notably, XRP's price began to stabilize and slowed its downward trend before completing this count, indicating that sellers might be losing urgency.

Higher timeframe signals can filter out short-term fluctuations, enhancing their significance. This TD buy signal does not act as a standalone indicator, but instead provides context to current market conditions, hinting that the momentum driving prices down may have peaked.

As a result, any future upward movement might require less force than previously necessary, assuming other confirmations emerge.

XRP Breaks Out of a Descending Triangle

XRP’s price recently managed to break out of a descending triangle pattern after holding strong in the $1.80–$1.85 demand zone multiple times. Each time the price dipped into this zone, buyers quickly stepped in, limiting further declines. This behavior suggests that buyers absorbed selling pressure rather than panicking.

As the price neared the apex of the triangle, buying pressure naturally built up, leading to a breakout. This new price target now shifts attention to the $2.20 area, a critical level where sellers have previously exerted control. If XRP maintains price above this level, it could set its sights on the $2.60–$2.67 range, a prior support level that has now become resistance. The next major target above this level is the $3 mark.

However, if the price cannot hold above $1.80, it would weaken the bullish outlook and reintroduce downside risks.

XRP price action analysis Source: TradingView

Strong Institutional Accumulation Through ETF Inflows

As of now, recent ETF data indicates a significant influx of $5.58 million in XRP being purchased in a single session, raising total ETF-held assets to $1.24 billion. This accumulation occurred while XRP traded around $1.80–$1.90, highlighting that this wasn’t a reaction to a breakout, but rather a strategic positioning by institutions.

Typically, institutions increase their exposure during consolidation phases rather than during price surges, suggesting these inflows may indicate a planned accumulation strategy rather than reactionary buying. Additionally, ETF accumulation decreases the circulating supply of XRP without demanding immediate upward movement in prices, which stabilizes the market before potential expansion.

Furthermore, these inflows align well with the macro TD buy signal, reinforcing the idea that bearish sentiment may be dissipating.

Source: X

Spot Outflows Indicate Absorption of Supply

Recent data from spot exchanges has shown persistent net outflows, including a notable -$7.82 million when XRP was priced around $1.87. This trend suggests a diminishing willingness to sell at current price levels.

When traders withdraw assets, they are often anticipating a reduced risk of declines. While such outflows alone don’t typically trigger upward momentum, they do tighten the available supply. In conjunction with structural support, this shift can alter market dynamics.

With fewer available assets, sellers encounter thinner liquidity, which heightens price sensitivity to demand. Additionally, these outflows have continued even post-triangle breakout, reinforcing confidence rather than caution among traders. Thus, strong buying pressure can more effectively push the price upward, allowing the market to absorb supply rather than distribute it.

Source: CoinGlass

Elevated Funding Rates Suggest Growing Conviction

Funding rates have also remained high, recently reaching 0.006, marking a significant increase of 94.58%. This suggests that traders are willing to pay to maintain long positions, indicating a level of confidence in the market. However, it’s important to evaluate the context in which these rates have risen; they increased while the price was consolidating around $1.85–$1.90, rather than during an aggressive rally.

This divergence hints at strategic positioning rather than speculative overexcitement. Moreover, leveraged positions have come into play after the market structure improved, which usually reduces immediate risks. Accordingly, while elevated funding carries its own risks, failing to maintain levels above the breakout zone could prompt a rapid unwinding of leveraged positions. For the time being, however, the market shows signs of growing conviction, backed by structural and capital flow analysis.

Source: CryptoQuant

Is XRP on the Verge of a Major Recovery?

Currently, XRP is trading at a crucial juncture where various technical structures, institutional movements, and derivatives positioning are aligning. The macro TD buy signal highlighted this shift, the breakout from the triangle confirmed it, and ongoing capital flows are reinforcing it.

While volatility in the short term is still a possibility, the evidence appears to support a scenario of accumulation rather than distribution. If XRP can maintain its price above the former triangle and hold onto the $1.80 mark, upward momentum may increase toward higher resistance levels. However, this scenario does not guarantee instant positive movement; rather, it implies that XRP may have completed its bottoming process and is entering a phase where sustained recovery becomes more likely.

Closing Thoughts

In summary, recent metrics suggest that XRP may have reached a low point and could be setting the stage for significant price movements ahead. Keeping a close watch on these indicators will be essential for traders and investors alike.