XRP’s (XRP-USD) red-hot run has hit a wall. The token dropped as much as 19% this week, falling from a multi-year high of $3.66 to as low as $2.95. But despite the steep drop, analysts aren’t ringing alarm bells just yet. Instead, they’re calling it what it looks like; a necessary cooldown after an overheated rally.
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Prices fell in line with the broader market, which slid more than 3% in the last 24 hours. At the time of writing, XRP is down 12.5% on the day, trading around $3.16. It’s a sharp reversal, but some are saying that this correction could pave the way for the next leg up.
Liquidations Wipe Out Overleveraged Longs
More than $113 million in XRP leveraged positions were liquidated, according to CoinGlass data. Of that, over $106 million were long positions — traders who had bet the price would keep going up.
This wave of forced selling came as part of nearly $1 billion in total liquidations across the crypto market in just 24 hours. Ethereum led the charge, losing nearly $200 million in positions, but XRP followed close behind.
Analysts say that kind of volume often marks a bottom. Pseudonymous analyst CryptoData noted that even though liquidations didn’t cross the $1 billion mark that typically signals a bottom, the recent volatility may have served the same function.
Indicators Flash Cool-Down, Not Collapse
XRP’s relative strength index (RSI), a key momentum indicator, had been flashing warning signs for days. On the daily chart, it had climbed above 88, deep into overbought territory. That’s now cooled off to around 56, giving the market some breathing room.
Technical support is sitting around the $3 level, with the 100-period simple moving average acting as a buffer. If that fails, prices could dip as low as $2.60, where the 200-SMA lies. But analysts aren’t too concerned. They see this dip as a chance to reload.
“This is a healthy correction,” said market watcher XRPunkie. “Sit back, chill and relax. Let it bottom out, and we should be on our way to much higher prices real soon. $10–$15 is still in play.”
Fellow analyst Egrag Crypto echoed that optimism. “Don’t let fear take over now,” he said, pointing out that buyers stepped in quickly after the drop with aggressive buying.
Long-Term Targets Remain in Sight
Despite the drop, analysts remain bullish on XRP’s bigger picture. Dom, a popular market analyst, recently suggested XRP could peak between $7 and $10 depending on how much capital rotates out of Bitcoin and into altcoins.
Lukas Enzersdorfer-Konrad, deputy CEO at Bitpanda, is also keeping the faith. He told TipRanks that XRP is still on track to retest and potentially break past its 2018 all-time high of $3.84. His view hinges on growing liquidity, improving sentiment around altcoins, and confidence in XRP’s role in the broader crypto ecosystem.
In short, the drop might look bad on the chart, but under the surface, many believe it’s just part of the path toward higher ground. At the time of writing, XRP is sitting at $3.1793.
