Ripple [XRP] has shed 14% in under six days after a feverishly bullish start to January, where it rallied 32.3% in five days. This rally was in a retracement phase, which has bulls asking – can XRP reach $3 by the end of January?
It was not an impossible ask. A recent AMBCrypto report highlighted how whale accumulation and reduced selling pressure from profit-taking meant the bulls were still in control.
If the $2 level remains in buyers’ control, the $3 target would be more likely to be achieved.
XRP: Long-term weakness or growing bullish intent?
The 1-week chart showed that XRP has gravitated back to the $1.86-$2.22 demand zone that the bulls have defended since December 2024. Whale accumulation has picked up in recent months, which bodes well for bulls.
Arguing the bearish case for XRP
The past week’s rejection from $2.40 was not pretty on the weekly XRP chart. The long wick to the upside represented bulls getting beaten back by the dominant bears.
This did not bode well for a move toward $3 later this month. The RSI was unable to climb back above neutral 50 to signal a momentum shift, and the OBV was also near the December 2024 lows.
What needs to happen for XRP to achieve $3 in January
XRP has a bullish structure, but its OBV remained in a bearish spiral. This might not be good enough to assure investors of a strong January performance.
A continued descent below $1.85-$1.90 would put severe stress on the bulls.
Moreover, the total market cap has slipped below a multi-year uptrend. At the time of writing, the former trendline support was being retested as resistance.
This was another signal that the recent altcoin momentum to start the year was a temporary relief rally and not a sustainable uptrend.
For XRP to resume its rally, Bitcoin [BTC] needs to climb back above $94.5k. It needs to keep its momentum going to smash aside the $100k psychological resistance as well.
This would turn the market sentiment around and drive fresh capital inflows. Investors should be prepared for XRP to be bearish in the coming weeks, based on the evidence at hand.
Final Thoughts
- The retest of the weekly demand zone and positive on-chain metrics suggested bullish potential.
- A closer look at the 1-day chart and the total crypto market cap showed that XRP bulls could be headed for trouble if demand doesn’t step in.
