XRP Experiences Intense Social Discontent—Is a 50% Bullish Reversal Imminent?

As we start 2026, XRP finds itself in a bearish trend, with investor sentiment dipping into extreme fear. Despite these tough conditions, analysts are suggesting that this negativity could pave the way for a significant bullish reversal, reminiscent of past trends.

Key Takeaways

XRP is currently facing extreme fear among investors, but historical data suggests that such sentiment can precede major rallies.
Institutional investments in XRP remain strong, with $424 million in ETF inflows in December alone.
There’s a 70-75% likelihood of a bullish reversal in XRP over the next two to eight weeks, fueled by current market conditions.
Three potential price scenarios exist for XRP, ranging from a bullish surge to continued bearish sentiment.

XRP

Institutional Activity Remains Strong

Recent reports reveal that times of extreme sentiment have often been precursors to significant XRP rallies, occasionally exceeding gains of 1,000%. Data from Santiment shows that negative mentions of XRP are now 20-30% higher than the low averages recorded in November.

This increase in bearish attitudes, paired with XRP stabilizing between the $1.8 and $1.9 range, indicates a "classic market divergence." This means that although sentiment is worsening, prices are consolidating, suggesting that panic from investors is occurring faster than any actual declines in fundamentals.

Within this wave of retail fear, institutional behavior tells a different story. Spot XRP exchange-traded funds (ETFs) reported inflows of about $424 million in December, marking them as the top-performing crypto ETF.

This stark difference between the extreme pessimism among retail investors—currently reflected in a fear index of 24—and the robust institutional accumulation, totaling around $1.3 billion over the last 50 days, often signals a more reliable precursor for market reversals than sentiment metrics alone.

70-75% Likelihood of a Price Turnaround

XRP's current situation exhibits extreme fear levels alongside a social sentiment considerably above baseline figures, combined with price stabilization. This historical pattern has previously led to substantial gains on multiple occasions since 2020.

For example, during the 2020-2021 cycle when XRP fell to $0.17 due to the US Securities and Exchange Commission (SEC) lawsuit, it later experienced a stunning 1,053% rally to $1.96 in just four months.

Today's circumstances echo this historical event. With institutional accumulation sharply diverging from retail capitulation, historical data indicates there is a 70-75% chance of a bullish reversal occurring within the next two to eight weeks. Currently, XRP is trading at about $1.90, while the Fear & Greed Index registers a score of 24. This creates several potential outcomes for the price.

Three Potential Price Outcomes for XRP

In the most optimistic scenario, we could see the Trump administration introducing clear pro-crypto regulatory measures in the first quarter, or BlackRock could submit an XRP ETF application. Additionally, the adoption of Ripple’s RLUSD stablecoin could quickly push its market size above $2-3 billion.

Historically, when the Fear & Greed Index rises from 24 into neutral territory (between 50 and 60), XRP has typically rallied by 30-50%, establishing targets between $2.44 and $2.82. If positive momentum continues into the mild greed phase (70+), XRP could reach between $3.00 and $3.20.

In a more neutral outcome, investor sentiment may gradually stabilize without substantial catalysts. ETF inflows could continue averaging $200-300 million monthly, while RLUSD grows through existing partnerships. Investors might witness the Fear & Greed Index rise from 24 to the 45-55 range, with XRP historically appreciating 15-25% during this timeframe, targeting prices from $2.16 to $2.35. If support at $1.85 remains steady throughout January, and trading volume surpasses $1.98, XRP could extend its price toward the $2.40-$2.50 range.

In a bearish scenario, extreme fear could persist for over eight weeks, characterized by a significant drop below $1.85 on increased volume. This situation could push XRP down to support levels between $1.65 and $1.70.

XRP The daily chart highlights XRP's efforts to rebound above $2 on Friday. Source: XRPUSDT on TradingView.com

XRP has recently surged by over 6% in the past 24 hours, moving towards $1.98 as part of a broader recovery within the crypto marketplace.

Featured image from DALL-E, chart from TradingView.com.