XRP has slipped below the key $3 psychological level, raising doubts among traders about its near-term trajectory. Despite the recent pullback, several analysts remain optimistic, predicting that the token could soon stage a decisive rebound toward fresh highs.
Support at $2.95 Becomes Crucial
The cryptocurrency has tumbled over 20 percent since reaching a July peak of $3.66, including a 4 percent drop in the past 24 hours that dragged it down to $2.96. Analysts argue that the $2.95 region is now a critical support level. If maintained, it could provide the base for another rally, while a breakdown risks opening the door to deeper losses.
Elliott Wave specialist Avi Harkishun notes that $2.95 previously acted as resistance during XRP’s mid-2021 recovery and later switched to support earlier this year. “Holding this zone could set the stage for another upward leg,” he said.
Rebound Towards $4.40 in Sight
Market watchers suggest XRP could rebound to the $4.00–$4.40 range if support holds firm. This target zone coincides with the 1.618 Fibonacci retracement level measured from XRP’s swing high of $3.38 down to its low around $1.61.
XRP/USD daily price chart. Source; TradingView
Pseudonymous analyst ThePenguinXBT echoed this view, calling the range-high targets “a good long opportunity.” Chart patterns also show a prevailing bull pennant that could lead to a breakout, with potential upside near $4.62.
Cup-and-Handle Formation Hints at $5.80
Adding to the bullish case, chartist AltcoinGordon has pointed out a classic cup-and-handle formation on the daily chart. XRP appears to be in the handle phase, consolidating in a tight band after a U-shaped recovery.
If the price breaks above the neckline near $3.80, the pattern projects an advance toward $5.80, which would mark a gain of roughly 90 percent from current levels. Such a move would cement XRP’s strongest rally since its early 2021 surge.
Risk of Correction Toward $2.40
However, analysts caution that failure to defend $2.95 could trigger a prolonged correction. Harkishun warns that a dip below this level may complete a so-called “WXY correction” – a three-wave pattern that extends the downturn rather than resolving quickly.
XRP/USD daily price chart. Source: TradingView
In this bearish scenario, XRP could fall to around $2.40, a level tied to heavy trading activity during 2020–21 and supported by the 200-day exponential moving average. Traders view this zone as a natural cushion where a rebound may eventually take place.
Outlook
XRP’s near-term direction hinges on whether bulls can reclaim the $3 threshold and defend $2.95 as a solid base. While the broader technical structure points to higher levels, including potential targets of $4.40 and $5.80, the risk of another leg lower toward $2.40 remains significant.
For now, market participants are closely watching how XRP behaves around these pivotal zones before committing to the next major move.
