Key Insights
XRP confirms a falling wedge breakout, signaling potential recovery after a 20% decline from January highs.
Institutional inflows into XRP ETFs totaled $67.8 million despite broader market volatility.
Stablecoin holdings on the XRP Ledger rose $100 million in January, indicating strong investor positioning.
XRP has declined by more than 20% since its local high in early January, falling from $2.39 to a monthly low of $1.81. This drop has placed the asset nearly 48.4% below its peak recorded in July last year. The decline aligns with a broader market correction influenced by geopolitical tensions and macroeconomic uncertainty.
The recent correction followed renewed concerns surrounding the U.S. government's tariff stance with major trade partners. In addition, fears about a potential federal shutdown and delays in the regulatory framework for digital assets have weighed heavily on market sentiment. The Federal Reserve’s continued hawkish tone has added to investor caution.
Investor interest remains resilient despite ongoing volatility
Despite the price drop, demand for XRP has remained firm. According to crypto.news, stablecoin holdings on the XRP Ledger have risen by $100 million in January, reaching $407 million. This trend often indicates that capital is being positioned for deployment. XRP exchange-traded funds (ETFs) have also reported consistent investor activity, showing only two days of net outflows while registering $67.8 million in inflows this month.
Source: TradingView
Recent data from Coinglass reveals that XRP outflows from centralized exchanges have consistently outpaced inflows. This shift suggests that investors are moving assets into self-custody, often a signal of confidence in long-term price prospects.
Falling wedge breakout points to potential short-term rally
On the technical front, XRP has broken out of a falling wedge pattern on the 4-hour chart. The wedge, formed by two descending trendlines, has acted as a key resistance structure since early January. A breakout from such a pattern typically signals a shift in market direction. The breakout confirms a bullish reversal and opens a path toward a short-term target of $2.23.
XRP is currently trading just above the psychological support of $1.80. Maintaining this level could allow bulls to push toward the previous monthly high of $2.39. However, any dip below this threshold may challenge the recovery trend and introduce renewed downside pressure.
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