XRP continues to face a challenging price environment as it struggles to break above the $3.00 mark. The altcoin has been consolidating in a tight range over the past month, weighed down by weakening network activity, falling open interest, and bearish technical indicators. Onchain data and market trends suggest that further downside could be in store before any significant recovery.
Consolidation Persists Below Key Levels
The price of XRP, currently at $2.12, has remained confined between $2.05 and $2.33 over the past 30 days. Despite brief attempts to reclaim higher ground, it has failed to overcome key resistance zones. This prolonged consolidation has been accompanied by a notable drop in XRP Ledger activity and broader investor participation.
Technical analysis points to a classic descending triangle pattern forming, which typically signals bearish continuation. If support around $2.00 breaks, analysts warn that XRP could drop as low as $1.20—representing a 45% downside move from current levels.
Sharp Decline in Network Activity
A major concern for XRP bulls is the steady decline in network usage. According to Glassnode data, the number of new daily addresses on the XRP Ledger has fallen drastically. From a peak of 15,823 on January 16, the figure now stands at just 3,500.
XRP/USD daily chart.
Similarly, daily active addresses (DAAs) have plummeted. After reaching a 3-month high of 577,000 on a Saturday, the number dropped sharply to 34,360 by Thursday. This dramatic decline in user activity reflects waning interest in the token and could be a sign of reduced long-term confidence in XRP’s trajectory.
Historically, drops in network activity are often followed by price stagnation or downside moves, as lower transaction volumes reduce liquidity and diminish upward momentum.
Falling Open Interest Reflects Bearish Sentiment
Another critical metric weighing on XRP’s price outlook is open interest (OI). Data from CoinGlass reveals that XRP OI has fallen by 30% in the past month—from $5.53 billion to $3.89 billion. This suggests traders are exiting their positions, anticipating further price declines.
This behaviour mirrors a similar trend observed in early 2025 when a sharp drop in open interest preceded a 53% decline in XRP’s price. Back then, the token fell from a multi-year high of $3.40 in January to a low of $1.61 by April.
The current trend could signal a repeat of this bearish cycle unless a shift in investor sentiment occurs soon.
Key Resistance from Moving Averages
Technical resistance is adding to XRP’s struggle. TradingView data shows that XRP is currently trapped below a significant resistance zone between $2.22 and $2.40. This zone aligns with the position of major simple moving averages (SMAs), which are acting as a ceiling for the price.
Unless XRP bulls can break through this resistance zone, the token is likely to continue consolidating below these levels. Historical patterns indicate that previous failures to surpass the SMAs resulted in extended sideways movement followed by deeper corrections.
XRP/USD weekly chart.
XRP analyst CasiTrades noted: “XRP price continues to struggle with the $2.25 level. As long as this remains resistance, it increases the likelihood that we’ll sweep the lower levels: $2.01, $1.90, even $1.55 are still on the table.”
Bearish Momentum Gains Strength
Momentum indicators further confirm the weakening trend. XRP’s Relative Strength Index (RSI) has fallen from an overbought reading of 81 on January 20 to a neutral level of 51. This drop indicates growing bearish sentiment and a lack of buying pressure.
While there is a possibility that XRP’s current consolidation could mirror the 2017 pre-breakout period—where the token eventually surged to new highs—current fundamentals and market sentiment suggest that such a scenario remains speculative in the short term.
Unless key metrics improve and investor confidence returns, XRP appears poised for further downside, with major support levels now in focus.
