XRP Price Faces Decline: Technical Indicators Suggest Further Correction

XRP, the native cryptocurrency of the Ripple network, has seen a notable decline of 5% over the last 24 hours, trading at $2.49 as of February 24. This downturn is part of a broader bearish trend in the cryptocurrency market, where the global market capitalization has dropped 1.8% to $3.15 trillion.

XRP Struggles at Key Resistance Levels

XRP's price drop can be attributed to several factors, primarily its recent rejection at a key resistance level of $2.60. This resistance, combined with a broader market pullback, has created downward pressure on the altcoin. Despite the recent rally in early February, XRP has faced challenges in maintaining momentum, as evidenced by the current price action.

Broader Crypto Market Weakness

XRP is not alone in its downturn. Other top-cap cryptocurrencies, such as Bitcoin (BTC), Ether (ETH), and Solana (SOL), have all experienced declines. Bitcoin, after briefly approaching the $100,000 mark on February 21, is down 0.7%, hovering around $95,900. Similarly, Ether has dropped 3.6%, trading just above $2,700, while Solana, Dogecoin, and Cardano have seen even steeper losses.

The broader weakness in the crypto market is mirrored in the derivatives market, where massive liquidations have been taking place. Over $234 million in leveraged positions were liquidated in the past 24 hours, including $9.4 million in long XRP positions. This forced selling pressure has only added to the downward momentum for XRP.

Liquidations and Caution Among XRP Traders

The liquidation of long positions and the accompanying decline in XRP’s funding rates further suggest that traders are becoming more cautious. XRP’s funding rate has dropped from 0.25% per week on February 22 to just 0.04% per week on February 24, signaling reduced demand for long positions and an overall sense of uncertainty among investors.

Key Technical Levels and Support for XRP

XRP’s price action is heavily influenced by its position relative to the 50-day simple moving average (SMA), which currently sits at $2.73. After experiencing an 11% decline from February 15 to February 24, XRP breached this crucial support level, which now acts as resistance.

For a sustained recovery, XRP would need to reclaim the 50-day SMA as support. If the price fails to break above this level, the next potential support zone is at $2.00. However, XRP does have some support at the 100-day SMA around $2.40. If the cryptocurrency closes above this level, there could be a retest of the 50-day SMA at $2.72, potentially paving the way for further bullish movement.

XRP’s Symmetrical Triangle and Potential Breakout

Popular analyst Dark Defender has identified that XRP is consolidating within a symmetrical triangle, a chart pattern that typically signals a period of accumulation before a breakout. According to Dark Defender, XRP must rise significantly above $2.77 to confirm the continuation of the “second leg of the bullish weekly structure,” which could lead to a retest of the multi-year high of $3.40.

Conclusion: Outlook for XRP

XRP is currently facing a critical moment. The price is under pressure due to the broader market sentiment and technical resistance at the 50-day SMA. However, support at $2.40 provides a potential cushion for cryptocurrency. For a bullish trend to resume, XRP needs to break above the resistance at $2.73 and ideally clear $2.77 to maintain its upward momentum.

Traders and investors will be closely watching these technical levels in the coming days, as the outcome of this consolidation phase could determine XRP’s next major move.