XRP is struggling to regain higher price levels as ongoing selling pressure and broader market uncertainty continue to dampen sentiment. Despite occasional pullbacks, momentum remains weak, with traders reluctant to capitalize amid high volatility and cautious liquidity conditions. The asset has yet to establish a convincing high, which reinforces the view that XRP remains in a transition phase rather than a guaranteed recovery trend.
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A recent CryptoQuant report provides more context on the exchange’s exchange rate data. According to the analysis, Binance recorded a sharp spike in the entry of the XRP exchange during the previously highlighted period that preceded the strong rally. Large inflows often indicate volatile tokens, fluctuations that are often interpreted as potential selling pressure as supplies become readily available for liquidation. Such spikes can increase short-term supply and increase volatility.
However, income does not always lead to immediate distribution. In the case mentioned, the increase in exchange deposits coincided with a volatile increase and ultimately preceded a significant price increase. This suggests that certain inflow events may represent strategic positioning, financial adjustments, or internal reallocations rather than outright sales. As XRP navigates the current uncertainty, monitoring the exchange’s flow remains important to assess whether renewed volatility could again precede a directional breakout.
Liquidity Compression Signals Rising Volatility Risk
The report explains that liquidity dynamics provide an important context for understanding the structure of the XRP market, especially when assessing volatility risk and potential price volatility points. USD liquidity measures the depth of funds supporting XRP trading pairs. During the previous phase of the rally, the USD currency increased significantly, allowing price developments to be captured without significant volatility. Recently, however, the USD currency has been falling, suggesting a shallower market depth compared to the expansion period. Reduced depth tends to increase sensitivity to flow regulation and can increase price volatility.
Liquidity measured in terms of XRP reflects the availability of tokens on the selling side. Before the last big breakout, the XRP currency was very depressed, showing a decrease in the active performance in the exchange. That phase of contraction is closely aligned with the beginning of a strong uptrend. Currently, XRP liquidity is decreasing again, showing similarities to previous expansion conditions.
Historically, this combination of inflow spikes accompanied by liquidity pressures has preceded increases in volatility. An increase in USD liquidity tends to support ongoing trends, while a decrease in liquidity usually causes volatility in the market structure.
Currently, exchange income remains moderate, but both USD and XRP income is coming in. This suggests a thin area where price reactions can be sharp. These indicators provide a structural context, but must be evaluated against derivative positions, funding trends, and broader contexts before drawing directional conclusions.
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XRP Remains Under Pressure As Key Support Levels Face Continued Testing
XRP remains under continued technical pressure, with the weekly chart showing a clear correction phase following a sharp rally that pushed the price above the $3.00 region by 2025. Since that peak, the price structure has shifted to a sequence of lower highs and lower lows, a pattern that is often associated with weak momentum rather than consolidation. The recent move towards the $1.40 area highlights continued selling pressure and a cautious stance among market participants.
From a technical perspective, XRP is currently trading below key moving averages that previously served as strong support. These averages now act as overhead resistance, limiting upside attempts unless price can confidently retrace them. The short-term average has risen sharply, while the long-term trend line remains tilted higher but is holding back, suggesting significant residual support associated with the collapse of short-term momentum.
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The volume activity is moderated compared to the impulsive meeting phase, indicating a reduction in the participation of projections. However, a decrease in volume during a correction may also indicate trader fatigue if it is accompanied by stability in the price structure.
Immediate support appears to be centered around recent lows around the $1.30–$1.40 area, while resistance remains concentrated around the $1.80–$2.20 range. Until XRP reclaims higher levels with strong participation, the broader trend remains weak.
Featured image from ChatGPT, chart from TradingView.com
