Cryptocurrency XRP is showing concerning technical patterns and fundamental metrics that suggest a significant price correction could be on the horizon.
XRP price traded 18% below its May peak of $2.65, and a convergence of several data points signals a possible drop toward $1.70, according to recent technical analysis from cryptocurrency experts.
Technical Analysis Points to Bearish Pattern
XRP price action between April 7 and June 2 has led to the appearance of an inverted V-shaped pattern on the daily chart. This formation emerged after an impressive rally that saw XRP surge 62% from a low of $1.61, only to face strong resistance at the $2.65 level where buyer congestion halted the advance.
The technical indicators are painting an increasingly bearish picture. The relative strength index (RSI) was facing down and dropped from 68 to 41 since May 12, indicating increasing downward momentum. This decline in momentum suggests that selling pressure is building among traders.
Market analyst MasterAnanda on TradingView has identified additional warning signs. His latest XRP analysis shows XRP has broken below a rising channel, with three consecutive daily closes below the lower trendline. The analyst warned that “the bearish momentum continues to grow” and suggested the altcoin might continue dropping until it reaches the $1.72 support level.
Bearish Divergence Signals Weakness
A particularly concerning development is the emergence of a bearish divergence between XRP’s price and its technical indicators. The daily chart shows that the XRP/USD pair rose between November 2024 and June 2025, forming higher lows. But, in the same period, its weekly RSI descended from 92 to 51, forming lower lows.
This divergence typically indicates underlying weakness in an uptrend, as it suggests that while prices are still climbing, the momentum behind the moves is actually diminishing. Such patterns often precede significant price corrections as profit-taking intensifies and buyer exhaustion sets in.
Network Activity Shows Alarming Decline
Beyond technical analysis, fundamental metrics for the XRP Ledger are raising additional red flags. The XRP Ledger has experienced a significant drop in network activity over the last two months.
The numbers are particularly striking when compared to earlier in the year. Daily active addresses (DAAs) on the network are now far below the year-to-date peak of 608,000 DAAs, recorded on March 19. With only around 31,200 daily active addresses at the time of writing, user transactions have declined significantly.
New user adoption has also plummeted dramatically. New addresses have also dropped from a 2025 high of 15,800 daily to the current 4,400, suggesting declining network adoption and user engagement.
This decline in network activity is particularly concerning because it typically correlates with reduced demand for the underlying cryptocurrency. Lower transaction volumes can reduce liquidity and buying momentum, often preceding price stagnation or drops.
Resistance Levels Remain Strong
Technical analysts are also noting that XRP continues to face substantial overhead resistance. XRP faces stiff resistance between $2.50 and $2.65. Overhead pressure from this area could continue suppressing XRP’s price over the next few weeks.
This resistance zone has proven particularly challenging for bulls to overcome, and the inability to break through these levels decisively has contributed to the current bearish sentiment surrounding the cryptocurrency.
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Market Context and Broader Implications
The potential XRP correction comes amid broader cryptocurrency market volatility. Recent data shows mixed sentiment across digital assets, with some cryptocurrencies experiencing significant inflows while others, like XRP, are seeing outflows from investment products.
XRP investment products posted the biggest outflows last week, totaling $28 million. The outflows marked a second week running of losses for XRP, according to CoinShares data, indicating that institutional investors are also growing cautious about the cryptocurrency’s near-term prospects.
Risk Considerations
As with all cryptocurrency investments, traders and investors should be aware that digital asset markets are highly volatile and unpredictable. While technical analysis and network metrics can provide insights into potential price movements, they are not guarantees of future performance.
The cryptocurrency market has historically demonstrated its ability to quickly reverse trends, and XRP has shown resilience in the past. However, the convergence of technical weakness, declining network activity, and institutional outflows presents a compelling case for caution in the near term.
For those holding XRP positions, the $1.70 level represents a key support zone to monitor. A break below this level could signal further downside, while a successful defense might provide the foundation for a potential recovery.
Current XRP price stands at approximately $2.15, representing the level from which the potential 20% decline to $1.70 is calculated.
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