XRP Price Trend Analysis
XRP began the week on a bullish note, increasing by around 7%. But, that momentum didn’t last long. By Wednesday, the altcoin saw a significant drop and continued on this downward path. While the outlook for XRP leans bearish, a recent technical analysis suggests it might be on the verge of a short-term rebound.
Possible Trend Exhaustion Signals
On January 30, technical analyst Ali Martinez shared insights on X, hinting that XRP might witness a bounce back soon, contingent on certain conditions. The key indicator here is the TD Sequential, a tool aimed at identifying when a trend—whether up or down—might pause or even reverse. In simpler terms, it helps track the exhaustion point of a trend in the short term.
The TD Sequential operates in two phases: a setup phase, which counts from 1 to 9, and a countdown phase that tracks up to 13. Typically, reaching a count of ‘9’ signals that selling pressure is diminishing, while a perfect “13” indicates a strong possibility of reversal.
Reviewing the chart provided by the analyst, it’s noted that the “9” count at the bottom has been reached. This suggests that the momentum fueling XRP’s recent drop may be fading. Coincidentally, this signal appears alongside an important support level. Martinez pointed out that as long as the support at $1.70 holds, there’s a chance for XRP to recover.
If the price rebounds at the $1.70 support, the range of $1.80-$1.85 could act as a critical resistance level, testing XRP’s momentum. Should the momentum strengthen and prices surpass these barriers, it’s possible that $1.90 might become a significant point of contention.
XRP ETF Experiences Outflows
In recent developments, the U.S. XRP Spot ETF has faced over $69 million in net outflows, according to data from an ETF tracking platform. The start of the week was relatively optimistic with a net flow of $23.87 million in the first three days. However, Thursday witnessed a significant outflow of $92.92 million, reversing the earlier gains. This negative figure is reminiscent of last week’s outflow of $40.64 million.
Such outflows often hint at a decline in institutional demand, indicating that withdrawals from the XRP ETF have outpaced deposits. This context further amplifies the notion that institutional investors could have influenced the recent dip in the price of Ripple tokens.
Nonetheless, negative net flows in ETFs don’t necessarily mean larger bearish trends are at play; they can also reflect profit-taking and cautious behaviors. At the time of writing, XRP is trading at $1.74, having slipped about 3.26% since the previous day, based on data from CoinMarketCap.
