- XRP faces strong resistance at $2.50 after its continuing consolidation period.
- On-chain liquidity highly suggests market optimism for the token’s upcoming move.
- A breakout above $2.50 could probably drive XRP to higher levels, possibly $3.00.
The recent XRP price action indicates a potential break after a period of consolidation. The weekly chart reveals a symmetrical triangle pattern, with key support at around $2.40 and resistance nearing $2.50. This pattern is forming after a series of sweeping price movements, with the trendline drawing a clear connection between the higher lows. If the price continues to respect these levels, it could lead to a decisive breakout in the coming weeks, probably breaking above the current resistance at $2.50. Such a move would align with the broader market structure and could set the stage for further upside toward $3.00.
Looking at the chart, there is a clear indication of a consolidation phase. The support zone is highlighted in orange, suggesting a potential area where the price could stabilize before making its next move. It seems like XRP might not break out all of a sudden and be left up in the waiting game. Chances are, it will test the trendline once more, and if it holds the resistance of $2.50, then maybe a correction will happen before the next try for a break.
Trendline Resistance and Potential for Breakout
The trendline is taking on a role as a dynamic resistance and has been tested multiple times over the past several months. As illustrated, the price has yet to close above this level, pointing out that the bulls might need more time to gather momentum before making a move. As of press time, XRP sits just below $2.44, with the continuing consolidation indicating a buildup of market pressure. If the breakout happens, a push above $2.50 would be a fragile level to watch, and it could lead to more price movement.
The consolidation phase seen in recent weeks might be a sign of accumulation, with market participants waiting for a decisive signal before making their next move. If the token can break through the trendline and hold onto higher levels, the path could open toward the $3 resistance zone. However, if it fails to break above $2.50 could lead to further sideways price action or even a pullback to support levels near $2.20.
Related: SEC Drops Ripple Lawsuit: XRP Surges After Five-Year Battle
On-Chain Liquidity Dynamics and Market Sentiment
The liquidity chart provides a deeper look into the on-chain dynamics surrounding XRP. The liquidation chart reveals a striking pattern of significant short liquidations, particularly noticeable in late November 2024 and early December. During this period, short liquidations spiked to over $37 million, aligning with a sharp upward price move according to data extracted from Coinglass.
Source: Coinglass
Looking at the most recent data, XRP’s total liquidations remained volatile, with the price hovering near $2.40. Interestingly, the liquidation data shows that long positions are starting to outweigh short positions, reflecting a shift in market sentiment.
Volatility and Liquidity: A Recipe for Price Action
The volatility of the price represented by the yellow line has steadily decreased over the past several weeks, remaining at a narrow range for the price action. Nevertheless, the growing number of liquidations suggests that the market participants expect some breakout or movement from the consolidation phase. If the price continues to tighten for an eventual breakout, it could turn into an extremely sharp move, especially if the liquidations increase.
