Comprehensive Analysis of XRP: Technical Patterns and Market Dynamics

Essential Highlights:

• The daily chart reveals an inverted V-shaped correction pattern in XRP, indicating a potential decline of approximately 20% to around $1.70.

• Bearish divergence observed between XRP’s price movements and the weekly Relative Strength Index (RSI) suggests increasing downward pressure.

• A noticeable decrease in daily active addresses points to diminished transaction activity, hinting at waning investor interest in XRP’s near-term prospects.

Currently, XRP is trading roughly 18% below its recent peak of $2.65. The convergence of multiple technical indicators signals a possible downturn toward the $1.70 support zone, representing a significant correction from recent highs.

Inverted V-Pattern Signals a Potential 20% Price Drop

Between April 7 and June 2, XRP’s price action has formed a distinctive inverted V-shaped formation on the daily chart. This pattern emerged after an impressive rally where XRP surged 62%, climbing from a low of $1.61 to a peak of $2.65. The rally was driven by strong buying momentum but was ultimately halted by resistance at the $2.65 level, leading to profit-taking and a sharp correction.

During this correction, the Relative Strength Index (RSI) declined from 68 to 41, reflecting a shift toward bearish momentum. This decline indicates increasing selling pressure and a potential continuation of the downward trend.

As the price attempts to complete the inverted V formation, it may test the neckline around the $1.72 level. A break below this support could lead to a further decline of approximately 20%, aligning with the pattern’s projection.

Market analyst MasterAnanda on TradingView echoes this outlook, emphasizing that diminishing bullish momentum and rejection at key support zones threaten XRP’s recovery, with a potential drop below $2.00 unless it finds strong support at $1.72.

“The correction might not be over yet,”

warns the analyst, highlighting the ongoing bearish trend.

Bearish Divergence Confirms Weakening Momentum

The bearish outlook for XRP is further reinforced by a divergence between its price trend and the RSI indicator. While XRP’s price has been making higher lows from November 2024 through June 2025, the weekly RSI has been declining from a high of 92 to 51, forming lower lows. This divergence suggests that the recent price increases lack underlying strength and could precede a reversal.

Such divergence often signals that the current bullish trend is losing steam, prompting traders to lock in profits at local highs and increasing the likelihood of a correction. Resistance levels between $2.50 and $2.65 are expected to pose significant hurdles in the coming weeks, potentially capping any upward movement.

Related: Market Predictions for 5/30: BTC, ETH, XRP, BNB, SOL, DOGE, ADA, SUI, HYPE, LINK

Declining Network Activity on the XRP Ledger

On-chain data reveals a notable decrease in activity on the XRP Ledger over the past two months. According to Glassnode, the number of daily active addresses (DAAs) has fallen sharply from a peak of approximately 608,000 on March 19 to current levels around 31,200. This decline indicates a significant reduction in transaction volume and user engagement.

Furthermore, the number of new addresses created daily has dropped from a high of 15,800 earlier this year to roughly 4,400, suggesting waning interest and adoption within the XRP ecosystem. Such a decline in network activity often correlates with stagnation in price and liquidity, potentially foreshadowing further price declines.

Lower transaction activity diminishes liquidity and trading volume, which can hinder price recovery and lead to prolonged periods of stagnation or decline. Investors should monitor these on-chain metrics closely as they provide valuable insights into the health and future trajectory of XRP.

Note: This analysis is for informational purposes only and does not constitute financial advice. All trading involves risk, and individuals should conduct their own research before making investment decisions.