XRP, the native cryptocurrency of Ripple Labs, has recently displayed mixed market sentiment, showing signs of potential bullish movement despite facing some challenges. As of January 31, 2025, the digital asset is trading near $3.13, reflecting a modest 0.80% price increase in the past 24 hours. However, XRP’s performance is somewhat overshadowed by a significant 35% drop in trading volume during the same period. This decline in volume suggests a lack of strong investor interest, which has led to XRP being surpassed by Stellar (XLM) in terms of market performance, with XLM seeing a notable 13% surge. Consequently, XRP investors and traders seem to be focusing their attention on other assets, such as XLM, as potential alternatives amid evolving market dynamics.
Despite the recent price struggles, XRP has formed a bullish technical pattern. A flag-and-pole price action pattern has been observed on the daily chart, indicating a potential for upward movement if certain levels are breached. Traders are closely monitoring the $3.21 resistance level, as a successful break above this threshold could lead to a substantial rally. If XRP manages to close a daily candle above this price point, technical analysis suggests a possible price surge of up to 40%, with the next target being the $4.50 range. The Relative Strength Index (RSI) for XRP is currently at 59, signaling that the token has sufficient room for further upward momentum, further strengthening the case for potential price growth.
In addition to technical patterns, on-chain data also supports the notion of growing investor confidence in XRP. On-chain analytics firm Coinglass reports that more than $12 million worth of XRP has been withdrawn from exchanges within the past 24 hours, signaling that investors are accumulating the asset in anticipation of future price increases. This accumulation could create buying pressure, which may propel XRP higher if it can maintain its bullish momentum. Despite this, market sentiment remains somewhat divided, as XRP continues to struggle with both positive and negative forces at play.
One of the key factors contributing to this mixed sentiment is the ongoing battle between long-term investors and short-term traders. Data from Coinglass’s liquidation map reveals that the $3.063 price level is a critical point for XRP, as it is where over-leveraged bulls hold $24.5 million worth of long positions. Conversely, the $3.183 level is where short sellers dominate, holding $50.09 million worth of short positions. The data suggests that the short-term market for XRP is currently dominated by short-sellers, creating an ongoing tug-of-war between bulls and bears.
Looking at the broader market, it’s evident that XRP faces some competition from other altcoins that are experiencing stronger growth. However, XRP’s technical setup and growing accumulation hint at the potential for a breakout if key resistance levels are broken. If XRP manages to overcome the $3.21 resistance level and shifts the market sentiment in its favor, it could see significant price appreciation. On the other hand, if selling pressure continues to dominate, XRP could face further consolidation or retracement before making another attempt at a breakout.
In summary, XRP is in a critical phase, as it balances between bullish technical indicators and market challenges. If it successfully breaks the $3.21 resistance level, a 40% rally to $4.50 is possible, but the mixed sentiment among traders and investors presents a degree of uncertainty. As always, XRP’s next move will depend on whether it can gain enough momentum to break free from the influence of short-sellers and push toward its next resistance level.
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