XRP Faces Critical Moment as Traders Eye a Surge to $2.50

Summary: XRP has been navigating a tough trading environment, managing to defend its crucial $2 threshold. The cryptocurrency rebounded almost 6% recently, following a period of negative market trends. Traders are closely monitoring the $2.30 resistance level that could signify a bullish breakout and potential rally up to $2.58.

Key Takeaways

A daily close above $2.30 could indicate a significant structural break and pave the way for XRP to reach $2.58.
XRP has shown aggressive movement among liquidity zones in 2025, increasing the likelihood of a significant price rally.
Although current funding rates are mildly negative and open interest has weakened, reclaiming the $2.22–$2.30 range could lead to a reversal of the downtrend.

XRP managed to hold onto its crucial $2 support level this week, bouncing back by nearly 6% on Tuesday after a momentary liquidity sweep occurred on Monday. Despite being in a longer-term downtrend that has persisted since July, the resistance area between $2.28 and $2.30 now serves as a critical pivot for any bullish movement.

XRP Faces Critical Moment as Traders Eye a Surge to $2.50

XRP at a Key Price Level as Chart Patterns Tighten

XRP's rise to $2.17 happened after touching the fair value gap (FVG) just under $2, which had formed during a previous rebound from $1.80 on November 21. This retest indicates that buyers are still active in this discounted pricing zone, even amid a broader downtrend.

XRP has been forming lower highs on its charts, but the compression seen just below $2.30 resembles a coil nearing a significant decision point.

XRP Four-Hour Chart Source: Cointelegraph/TradingView

A daily close above the $2.30 mark would signal the first trend shift since July, confirming a bullish structural break and clearing a pathway towards the next liquidity cluster at $2.58. The range between $2.34 and $2.42 is identified as a sell-side FVG, likely to draw early profit-taking.

Historically, XRP's price behavior in 2025 has been marked by powerful transitions between varying liquidity pockets. When momentum shifts, XRP often overshoots resistance levels to capture liquidity, making $2.58 a viable short-term target.

The relative strength index (RSI) indicates a moderately bullish sentiment, and reclaiming the 200-period simple moving average (SMA) would further validate this. Additionally, open interest in futures has dropped sharply from $8.6 billion to $3.8 billion in Q4, suggesting that when a directional move does occur, it could happen swiftly due to lighter positioning.

Related: Daily crypto liquidations nearly triple as leverage overheats: Glassnode

Mixed Funding Dynamics and Trader Sentiment

Analyst Pelin Ay noted that XRP's funding rates are largely negative, suggesting that short positions are prevalent in the futures market. As both price and funding rates drop together, sentiment corroborates the downtrend, increasing the likelihood of a retest of the $2.00–$1.90 zone unless there is a structural change.

Should the funding rates fall below –0.01, Ay believes that the approach towards $1.90 becomes more probable. However, deepening negative funding often precedes liquidity raids, which means XRP could retreat momentarily before attempting to break above $2.30.

Meanwhile, notable crypto trader Dom has identified potential signs of an emerging reversal. By inverting XRP’s chart, Dom has observed a distinct three-drive exhaustion pattern over the past six weeks, indicating trend fatigue.

An upward movement has finally been established, and reclaiming the monthly rVWAP (relative volume-weighted average price) at $2.22 could signify that a bullish shift is beginning, leading the price toward the $2.50 region. However, Dom advises caution.

XRP Analysis by Dom Source: X

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