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XRP faces growing bearish pressure as key market indicators suggest a potential downturn towards the $1.60 range amid increased selling activity.
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The recent decline in XRP’s cumulative volume delta (CVD) and the bearish sentiment in the futures market are raising concerns among investors about further price drops.
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“Large holders seem to be offloading positions, which may lead to a prolonged bearish trend,” noted Ki-Young Ju, founder of CryptoQuant.
XRP’s market signals a potential downturn, with whale selling and bearish futures shifting outlooks towards a retest of $1.60 amid declining demand.
XRP Markets Lack Buyers as Futures Flip Bearish
XRP’s price has encountered significant resistance, currently sitting 37.1% below its all-time high of $3.40. On February 3, a drop of a similar magnitude was quickly offset by purchasing activity that propelled XRP back above $2.50. However, the current sentiment is markedly different.
According to aggregated data from aggr.trade, XRP’s spot cumulative volume delta fell by 50% throughout March, indicating a drop in buying interest and a prevailing bearish trend.
A significant negative CVD of -$408 million reveals that selling pressure is outpacing buying volume, while futures traders are echoing this bearish sentiment. The perpetual CVD dropped to -1.18 billion on March 11, suggesting that traders are increasingly opening short positions, which is often a precursor to further price declines.
Whale Activity Indicates Distribution Phase
The past week has shown discernible trends in XRP’s trading volume, particularly with whale activity that persists into early March. Ki-Young Ju of CryptoQuant highlighted that the increase in trading volume correlates with a distribution phase, where major investors gradually liquidate their positions to realize profits.
The distribution phase has intensified, with data showing that whale outflows—tracked as a 30-day moving average—have escalated. In total, between March 4 and March 10, whales liquidated around $838 million in XRP, amplifying the bearish narrative and suggesting a sustained sell-off.
XRP Price H&S Pattern Hints at $1.60 Retest
Recent analysis of XRP’s 1-day chart reveals a significant technical formation—a head-and-shoulders (H&S) pattern. The completion of this pattern occurred when the asset closed below $2.05, identified as the critical neckline. This indicates possible strong bearish repercussions, particularly as it unfolds in higher time frames.
If XRP cannot reclaim the $2.05 level as a support base, it is likely to target lower price ranges. This zone aligns closely with the 0.5 and 0.618 Fibonacci retracement lines, often referred to as the “golden zone,” with the retest range estimated to be between $1.90 and $1.60. Given the current analysis, the likelihood of testing the $1.60 support level is significantly high, and failure to maintain this range could trigger further declines toward a long-term demand zone between $1.58 and $1.27.
Conclusion
In conclusion, XRP’s market dynamics reflect a challenging landscape marked by selling pressure from whales and bearish sentiment in trading futures. With key price indicators pointing toward a potential retest of the $1.60 level, it is crucial for investors to remain vigilant and consider the implications of these market behaviors on XRP’s future performance. The current environment urges caution, as the historical price patterns and the market sentiment suggest further declines could be on the horizon.
