Why XRP Price is Declining After Rallying to $2.40

XRP price has seen a downturn after facing rejection at a key resistance zone, indicating a corrective phase as it falls back below important volume levels.

Key Takeaways

XRP's price has declined after failing to hold above the $2.40 resistance level.
The rejection occurred at the 0.618 Fibonacci retracement, highlighting a critical decision point.
Volume behavior during the rally suggests weak demand at higher price levels.
The next key technical level to watch is the value area low, which could determine XRP's price stability.
A break below the value area low may lead to further declines, targeting around $1.79.

XRP price rejections from volume resistance, risking further downside.

After a recent rally that peaked near $2.40, XRP is experiencing a pullback that has ignited discussions about whether the price surge has failed or if the current decline is part of a normal correction. Analyzing the technical indicators surrounding this movement reveals important resistance levels and potential future price action.

XRP Price Analysis: Technical Insights

Why XRP price is falling after $2.40 rally - 1

XRP's recent price rejection at $2.40 coincided with the 0.618 Fibonacci retracement level, a significant point that often indicates either the continuation of a trend or a reversal. This level was complemented by the Point of Control, which represents a high-confluence resistance zone where selling interest has historically emerged.

When XRP reached this area, the price reacted sharply downward, indicating active selling rather than mere profit-taking. The failure to maintain prices above the Point of Control suggests that buyers lacked the necessary confidence to push the rally any further.

Examining volume dynamics provides additional insight into the market's response. The ascent to resistance was marked by relatively low trading volume, while selling pressure increased considerably during the subsequent decline. This trend indicates weak demand at elevated price levels, suggesting that the rally's strength was compromised once it entered a zone of high historical trading activity.

Currently, XRP has fallen back below the Point of Control, marking a significant development from a market profile perspective. When prices settle below this upper range, it often prompts a rebalancing of supply and demand, leading to rotational price movements.

The next crucial technical level is the value area low, which acts as the lower boundary of fair value. If XRP can hold above this level, it may stabilize and continue to trade within its range. Conversely, failing to defend this support might increase the likelihood of a deeper corrective decline.

In such a scenario, the $1.79 level could become the next major target for downside movement. This level aligns with previous structural support and may serve as a natural re-entry point for buyers, allowing prices to reset after a failed breakout.

Future Price Action Expectations

As long as XRP remains below the Point of Control and faces resistance near $2.40, the likelihood of downward price action remains high in the short term. Attention will focus on whether XRP can find support at the value area low or whether it breaks lower.

A sustained drop below this crucial support level could lead to further declines towards $1.79, where stronger buying interest is anticipated. On the other hand, successfully defending this lower support may keep XRP trading within its range, allowing the price to reverse higher as selling pressure diminishes.