TL;DR

• Bitcoin charted a new all-time high, and even Ethereum managed to post some impressive gains in the past month. However, Ripple’s cross-border token has failed to recapture any of its previous momentum.
• Here’s what ChatGPT thinks about the current situation and what might be the cause of it. Also, will there be a breakout soon?

Current Price Landscape

Numerous prominent crypto analysts have outlined in the past several weeks how important the support levels of $2.3 and $2 are for XRP’s future price movements. The former, though, has already been broken to the downside and many of them believe the asset is primed for another retracement toward the latter.

Recall that the last time XRP slumped beneath $2 was in early April as the financial world braced for the impact of Trump’s growing and constant tariffs against essentially every country.

Although the economic situation improved dramatically in the following two months and many cryptocurrencies, such as the aforementioned new BTC peak and ETH’s revival, marked impressive gains, XRP remained on the sidelines to some extent and was quickly stopped during its surge toward $2.6. It was (and still remains) confined in a descending pattern that has seen another 6.5% decline on a weekly scale.

Why So?

ChatGPT first listed the broader market conditions as one of the reasons behind XRP’s stagnation, but that sounds accurate only if we take into account the past week, in which many digital assets have turned red. However, XRP has been outperformed by ETH, BTC, and many, many alts, such as HYPE, on a monthly scale as well.

The AI solution noted that investor sentiment and behavior have changed lately toward XRP, as the post-US election hype has evaporated. Now, even though Ripple essentially won its legal fight against the SEC, investors are “opting to sell during minor price increases rather than holding for long-term gains.”

ChatGPT mentioned XRP’s tokenomics, in which a billion new coins are released monthly. According to its answer, this continues to add selling pressure for XRP and may hinder its progress.

“This consistent increase in available tokens can suppress price growth, especially if demand doesn’t keep pace.”

On the question of what could help XRP break out of its consolidation, the AI chatbot said it might take a significant change in investor behavior, such as whales going on a massive accumulation spree similar to the one at the end of 2024, as well as an overall improvement in the market. Additionally, big partnership or acquisitions can aso fuel a new rally.

Bitcoin (BTC) is well within a bull market, but certain metrics suggest that the cryptocurrency may have reached a short-term top. This means that BTC may experience a significant price correction before another rally ensues.

A report from the market analytics platform CryptoQuant revealed that the metrics that appear to be overheating are those pertaining to Bitcoin’s demand growth. Regardless, Bitcoin’s overall conditions remain bullish, and the CryptoQuant’s Bull Score Index is at 80. Historical data shows BTC has continued to rally, provided the index remains above 50.

Demand Metrics Are Overheating

CryptoQuant analysts report that BTC balances held by whales have increased by 2.8% over the past month. They also estimate Bitcoin’s demand growth to be at 229,000 BTC within the same time frame. This figure is close to the demand growth recorded in December 2024 at 279,000 BTC when the cryptocurrency surged past $100,000 for the first time.

Such paces often precede a slowdown in whale accumulation, and as analysts always say, BTC needs strong demand to sustain a rally.

Additionally, the Bitcoin Traders’ Unrealized Profit Margin has approached a level that often indicates potential resistance for prices. According to historical data, bitcoin’s price surge tends to slow down whenever the metric nears 40% or crosses below its 30-day moving average, which is currently at 19%.

At the time BTC rallied past $111,000 last week, the margin hit 32%. This means it got close to 40%, which is the level marked for overheating.

Bitcoin Falls Below $104K

Analysts believe $120,000 could be the next major resistance level for BTC if it continues to rally. This is because $120,000 is the upper band of the Traders’ On-chain Realized price – here, the unrealized profit margin sits at 40%. Historical data indicate that this upper band has consistently served as a key resistance during bull markets.

While BTC still faces the possibility of a continued rally, the asset had fallen below $104,000 at the time of writing. Data from CoinMarketCap showed BTC was down 2% in 24 hours, tumbling from the $105,000 level.

Meanwhile, analysts have revealed that BTC investors have been realizing some profits following the recent price surge, but at moderate levels compared to past markets. Hence, there is no evidence to suggest that the bull cycle is ending; in fact, market conditions indicate continued strength in bitcoin’s upward trajectory.

Ripple faced a sharp rejection at the upper boundary of its descending wedge, triggering a significant decline. Adding to the bearish outlook, the asset has slipped beneath both the 100-day and 200-day moving averages, an important technical breakdown that raises the probability of an extended correction.

XRP Analysis

The Daily Chart

XRP’s recent attempt to break out of its long-standing consolidation range has been met with notable selling pressure. After testing the upper boundary of its descending wedge formation near $2.5, the asset was firmly rejected and has since declined sharply, breaking below both the 100-day and 200-day moving averages, previously acting as dynamic support around the $2.2 level.

This bearish development is further intensified by the emergence of a death cross, where the 100-day MA has crossed below the 200-day MA, often seen as a signal of mid-to-long-term bearish sentiment.

With momentum now favoring the bears, the focus shifts to the next significant support zones: the psychological $2 level and the wedge’s lower boundary around $1.5. These lines are likely to be critical battlegrounds for bulls attempting to halt the downtrend.

The 4-Hour Chart

Zooming into the 4-hour timeframe, XRP had been confined within a short-term ascending wedge, typically a bearish pattern. The price has since breached the wedge’s lower trendline near $2.3, confirming a breakdown and reinforcing the bearish narrative.

Currently, Ripple is testing a key support level at the $2.1 region. A decisive drop below this level could accelerate the downtrend, opening the door for a fall toward the $1.5 support area. On the flip side, if buyers manage to defend this level, a temporary consolidation phase between $2 and $2.3 could follow, though momentum still leans bearish unless a strong reversal develops.