XRP Faces Potential Further Decline Below $3 Amid Bearish Momentum and Key Support Near $2.6

XRP is currently trading below the critical $3 resistance level after intense selling pressure, with bearish indicators pointing to a potential further decline toward $2.6 in the short term.

Technical indicators confirm sustained bearish momentum, with the Directional Movement Index and Awesome Oscillator signaling downtrend strength.

Exchange data shows high selling pressure peaked mid-July but has since eased, suggesting potential stabilization ahead.

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XRP price analysis reveals key resistance at $3 and possible support near $2.6. Stay informed with COINOTAG’s expert market insights.

XRP Faces Strong Resistance After Losing $3 Psychological Level

After rallying past the $3 mark in July, XRP encountered significant selling pressure that pushed prices back below this crucial psychological barrier. This level, which previously acted as resistance, now reinforces bearish sentiment as sellers dominate above it. The inability to reclaim $3 indicates that profit-taking and market caution are prevailing forces.

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Technical Indicators Confirm Bearish Momentum

Analysis of XRP’s 12-hour chart reveals a downward trend in the Accumulation/Distribution (A/D) line, highlighting increased selling volume. The Awesome Oscillator further supports this bearish outlook by showing negative momentum. Additionally, the Directional Movement Index (DMI) components, with the -DI and ADX above 20, confirm a strong downtrend, signaling that sellers currently control market direction.

Source: XRP/USDT on TradingView

Are Further Declines Below $2.6 Likely for XRP?

XRP’s next critical support zone is around $2.6, which aligns with a Fair Value Gap and previous range highs on the daily chart. This level could serve as a short-term target if bearish momentum continues. Exchange data from Glassnode shows that XRP holders moved large volumes to exchanges in late July, indicating peak selling pressure. Although this trend has softened, net inflows remain positive, suggesting cautious sentiment persists.

Source: Glassnode

Valuation Metrics Suggest Room for Long-Term Growth

The MVRV Z-Score for XRP remains well below historical highs despite the recent price rally, indicating that the token is not currently overvalued. This metric suggests that XRP has potential for further appreciation over the long term. Investors considering entry points may find the $2.6 level attractive for accumulation, especially if bearish pressure drives prices down to this support.

Source: Glassnode

What is causing XRP’s recent price decline?

XRP’s recent price decline is caused by strong selling pressure following a failed attempt to sustain levels above $3, combined with broader market weakness in Bitcoin and increased token transfers to exchanges signaling profit-taking.

How do technical indicators reflect XRP’s current market trend?

Technical indicators such as the Accumulation/Distribution line, Awesome Oscillator, and Directional Movement Index all point to sustained bearish momentum. These tools confirm that selling volume is dominant and the downtrend remains strong.

Frequently Asked Questions

What caused XRP to fall below the $3 resistance level recently?

XRP fell below $3 due to increased selling pressure and profit-taking after a brief rally, coupled with Bitcoin’s price decline, which affected overall market sentiment.

How likely is XRP to recover above $3 soon?

Given the current bearish momentum and strong resistance at $3, a quick recovery is unlikely without a significant shift in market dynamics or renewed buying interest.

Key Takeaways

• XRP dropped 13.6% after failing to hold above $3: This level now acts as resistance amid strong selling.
• Technical indicators confirm bearish momentum: DMI and Awesome Oscillator signal a persistent downtrend.
• Support near $2.6 offers potential entry: Valuation metrics suggest room for growth beyond short-term declines.

Conclusion

XRP’s recent price action highlights the challenges of sustaining gains above $3 amid broader market weakness. While bearish momentum may push prices toward $2.6, valuation metrics and easing selling pressure indicate potential for a rebound. Investors should monitor technical signals and exchange flows closely to identify entry points and market shifts.