XRP Price Forms Rare Pattern: Is a Rebound on the Horizon?

XRP’s price has recently experienced a notable retracement after the strong gains made in November, with the cryptocurrency dipping to $2.14 on Monday. This marks a 26% decline from its recent peak, pushing the coin into bear market territory. This decline is part of a broader market pullback, as many altcoins, including XRP, have faced sell-offs. The sell-off in XRP has been reflected in its social sentiment and futures market activity. According to data from CoinGlass, XRP’s futures open interest dropped significantly, falling to $1.89 billion on Monday, down from a year-to-date high of over $4.29 billion. This shift suggests that investor interest in leveraged positions is waning. Furthermore, XRP’s 24-hour trading volume, which had been much higher in previous weeks, has also seen a decline, indicating that market activity and momentum have slowed down.

Despite this downturn, XRP still holds several key fundamentals that could potentially propel its price higher in the near future. One of the most important factors is the continued support from large holders of XRP. According to on-chain data from Santiment, the number of XRP holders has increased, with over 5.75 million addresses holding the cryptocurrency, which is up from the October low of 5.36 million. This suggests that the broader investor base is holding steady, and large holders (whales) are not opting to sell their holdings during this dip. While the number of active addresses has slightly decreased, this is a common occurrence during market corrections, and it may indicate that many smaller retail investors are holding off on selling, awaiting potential rebounds.

Looking ahead, XRP has some significant catalysts that could provide a boost to its price. One such catalyst is the introduction of Ripple’s USD stablecoin, RLUSD, which has already shown growth, reaching a market cap of over $53 million just one week after its launch. While CoinMarketCap has cautioned that the assets backing RLUSD have not yet been fully verified, the success of the stablecoin in such a short period of time points to growing confidence in Ripple’s ecosystem. Additionally, there is growing speculation that the U.S. Securities and Exchange Commission (SEC) may approve a spot XRP exchange-traded fund (ETF) in 2025. If such a move were to happen, it could serve as a major catalyst, creating more demand and institutional interest in XRP. The idea of a spot ETF, combined with the rising number of crypto-friendly figures in U.S. politics, including the actions of Donald Trump’s crypto council, has fueled optimism for XRP’s long-term prospects.

From a technical perspective, XRP appears to be forming a bullish pennant chart pattern, a classic technical formation often seen before a price breakout. This pattern is characterized by a sharp price rise followed by a period of consolidation, where the price forms a symmetrical triangle pattern. The lower boundary of the triangle connects the recent lows of Dec. 10 and Dec. 20, while the upper boundary connects the recent highs of Dec. 3 and Dec. 17. This consolidation indicates that the market is waiting for a decisive move, with the breakout typically indicating a continuation of the previous trend. XRP is also trading above its 50-day moving average, which is a positive sign for the bulls, as this suggests that the price could continue to move upward. In addition, the coin is at the weak “stop & reverse” point of the Murrey Math Lines, which could act as a further signal for a potential bullish reversal.

Given these factors, analysts are optimistic that XRP could experience a bullish breakout in the near future. If XRP successfully breaks above the resistance level formed by the upper side of the pennant, it could target its year-to-date high of $2.90. Such a price movement would represent a strong rebound for XRP, especially given the recent sell-off and broader market correction. While the short-term outlook might seem uncertain due to the ongoing market consolidation, the long-term fundamentals and technical signals point toward a potential price rebound, especially if XRP can maintain its support levels and the broader cryptocurrency market shows signs of recovery.

In conclusion, despite the recent drop in XRP’s price and the ongoing market pullback, there are several key factors that suggest a potential rebound in the near term. The strong fundamentals, including continued support from large holders and the growth of Ripple’s ecosystem, combined with the technical formation of a bullish pennant pattern, suggest that XRP could break out higher if the broader market conditions align. If this happens, XRP could target a price of $2.90 or higher in the coming weeks, making it an interesting asset to watch in the context of the cryptocurrency market’s ongoing evolution.