XRP Price: Warning Signs Appear Amidst Bullish Long-Term Forecasts

Is the recent XRP price rally losing steam? After gaining over 50% in a month, many traders are wondering if the upside is exhausted or if there’s more room to run. Let’s dive into the latest technical signals and on-chain data to understand the current XRP market dynamics and potential next moves.

Short-Term Risks Highlighted in XRP Analysis

Recent price action for Ripple XRP has formed patterns that suggest caution in the short term. Two specific technical formations are flashing potential downside signals:

• Double Top Pattern: XRP peaked near $2.65 twice, followed by a drop below the neckline around $2.47. This bearish pattern indicates weakening buying pressure after a strong advance. A confirmed breakdown below the neckline points to a potential target around $2.30. If buyers cannot push the price back above $2.65, this bearish setup remains active.
• Rising Wedge Breakdown: XRP also broke below the lower trendline of a rising wedge pattern. This typically signals a shift from bullish momentum to bearish. Failed attempts to reclaim the upper trendline reinforce this view. A confirmed breakdown, especially if XRP loses support at the 50-4H EMA, could lead to a significant decline.

Measuring the height of the rising wedge pattern and subtracting it from the breakdown point suggests a potential 20% drop towards the $1.94 level. This area is particularly important because the $2.00–$2.04 range holds a large cluster of leveraged long positions, estimated at $50 million according to CoinGlass data. A drop below this range could trigger a long squeeze, increasing selling pressure and potentially accelerating the move towards the $1.94 target.

On-Chain Data Points to Trader Denial

Examining on-chain metrics provides further insight into trader sentiment. The Net Unrealized Profit/Loss (NUPL) for XRP has entered the Belief–Denial zone. Historically, this zone has preceded significant price corrections in 2018 and 2021. While in denial, many traders may still expect prices to rise, even as technical momentum fades. If historical patterns hold true, this NUPL signal supports the potential for short-term downside outlined by the technical charts, influencing the immediate XRP forecast.

Long-Term Outlook Remains Bullish

Despite the short-term warning signs, longer-term charts for XRP present a more optimistic picture. A multi-month falling wedge pattern suggests the potential for a significant upward move. A successful breakout from this pattern could target $3.69 by June, representing a potential 45% rally from current levels.

Furthermore, several long-term XRP analysis projections, based on symmetrical triangle patterns and Fibonacci extensions, point to even higher targets, potentially reaching $5.24 or even $17. These long-term structures indicate that the overall bullish bias for XRP may still be intact, suggesting the rally is likely not over in the grand scheme, even if a short-term pullback occurs.

However, it’s crucial to note that the bullish long-term scenario could be invalidated if XRP falls back below the falling wedge’s upper trendline and loses key support levels like the 20-day and 50-day EMAs. Such a move could risk a decline toward $1.75.

Conclusion: Navigating Mixed Signals in the XRP Market

The current XRP market presents a complex picture with conflicting signals. Short-term technical patterns like the double top and rising wedge, combined with the NUPL metric entering a historically significant zone, suggest potential downside risk towards the $1.94-$2.30 range. However, long-term chart structures remain decisively bullish, pointing to ambitious targets between $3.69 and $17 if these patterns play out. Traders and investors should carefully consider both the immediate risks and the long-term potential when making decisions regarding their XRP forecast. As always, conducting thorough personal research is essential in the volatile crypto market.

Disclaimer: This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.