XRP Price Forecast: Will It Rebound to $3 or Crash to $1.50?

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The crypto market took a hit today, with Bitcoin dropping 4% to $82,176, marking an 11% decline for the week. The overall market fell 7%, with major altcoins like ETH, SOL, and XRP seeing losses between 7-9%. This downturn is fueled by rising tensions in the U.S.-China trade war, Trump’s executive order blocking taxpayer money from buying altcoins, and a massive $616 million in liquidations, mostly from long positions.

XRP has been struggling since reaching its all-time high of $3.40 on January 16, now trading at $2.18 after a steep 35% decline over two months. This drop has significantly reduced the number of XRP tokens held in profit. According to on-chain data, XRP’s supply in profit has shrunk by 6.39 billion tokens in just a week, marking its lowest level this year. The growing number of investors holding XRP at a loss suggests increasing selling pressure and weak market sentiment, which could push prices even lower.

Demand Slows as Fewer Investors Show Interest

A key factor behind XRP’s weak performance is the lack of new demand. Data from Santiment shows that only 4,516 new wallet addresses were created on Sunday to trade XRP—the lowest daily count recorded this year. This indicates a slowdown in fresh investments, meaning fewer traders are entering the market. When new demand drops, trading activity slows down, and support for the token weakens. If this trend continues, it could make it difficult for XRP to recover in the short term.

Meanwhile, Morgan Stanley’s Michael Wilson expects the S&P 500 to drop 5% in the first half of the year, which could also push XRP and other altcoins lower as market liquidity shrinks.

Moreover, Altcoin’s woes may continue as Trump admitted the U.S. economy is in a “period of transition,” while Treasury Secretary Scott Bessent cautioned about short-term economic disruptions.

XRP Struggles to Break Out

On the technical side, XRP has been trading below a descending trendline since its all-time high, forming a bearish pattern of lower highs. This means sellers are still in control, and the token is struggling to gain upward momentum. If XRP fails to break above this resistance level, it could continue its downward trend. Currently, XRP is hovering around $2.17, and if the selling pressure intensifies, it could drop below $2, possibly testing support levels at $1.47.

Can XRP Bounce Back?

For XRP to reverse this trend, it needs strong buying pressure to break above the descending trendline. If it manages to do so, the next major resistance level is at $2.93. A breakout above this point could signal a potential recovery. However, with demand at a yearly low and bearish sentiment dominating, XRP faces a tough battle ahead. Unless investor interest picks up and market conditions improve, the token could remain under pressure, with the risk of further declines in the coming weeks.