XRP's Temporary Pullback: What's Next for the Upward Trend?

XRP has recently experienced price decline after a significant rally earlier this month, but technical indicators suggest this may be a temporary setback in a larger bullish trend.

Key Takeaways

XRP's price is currently in a retracement phase after a surge earlier in January 2026.
The recent drop has brought XRP to the 0.236 Fibonacci retracement level around $2.27, a key area of support.
The analysis suggests a potential revisit to the $2.30 to $2.33 range could determine the extent of this pullback.
If unsuccessful in reclaiming this zone, XRP may retrace further to about $2.18.
The overall outlook remains bullish, with projections for future prices between $2.49 and $2.66, depending on the correction's bottom.

XRP

After climbing from under $2 on January 1 to a peak of $2.41 by January 6, the market is now recalibrating. The critical question is whether the short-term Fibonacci levels can sustain as momentum shifts, with the next price movement likely shaping XRP's near-term direction.

Understanding XRP's Recent Rally and Current Pullback

Over the last day, XRP's price has been on a downward trajectory, following a robust upward movement at the beginning of the week. To put this into perspective, XRP started January 2026 at approximately $1.85 and surged to around $2 by January 6, marking an impressive 30% gain in just a few days.

On January 4, XRP fluctuated between $2.01 and $2.12 until demand surged. By January 5, trading expanded to the $2.09 to $2.36 range, indicating a clear increase in momentum. The rally continued throughout January 6 and 7, with XRP briefly exceeding $2.41 before sellers began to emerge.

According to technical analysis by TARA shared on X, the recent pullback has brought XRP down to the 0.236 Fibonacci retracement level, approximately $2.27. This level has become crucial, acting as the first significant support after the recent price surge. The accompanying chart demonstrates how the price reacted quickly around this area, with a notable drop visible on the 4-hour candlestick timeframe.

XRP
Source: Chart from TARA on X

What’s Next for XRP: Future Expectations

Momentum indicators suggest that the correction is still in progress but does not indicate overall structural weakness. The 14-day Simple Moving Average (SMA) is trending upward toward the price, potentially serving as dynamic support, which typically helps limit declines during healthy pullbacks.

The analyst believes that XRP must revisit the $2.30 to $2.33 zone during this corrective phase. This range previously acted as resistance and will be key in determining if the pullback stays minimal or extends further.

Should XRP struggle to reclaim this zone, it could point to a more significant retracement toward the 0.382 Fibonacci level around $2.18. However, even in this scenario, the price movement would align with a cooling trend rather than a breakdown of the bullish structure.

Despite the current correction, the broader outlook remains positive. Once this retracement reaches a confirmed low, XRP is expected to return to its previous highs. Based on current trends, potential upside targets range from $2.49 to $2.66, though fluctuations are anticipated depending on where the correction ultimately concludes.

XRP
XRP trading at $2.10 on the 1D chart | Source: XRPUSDT on Tradingview.com