XRP Faces Market Pressure Amid Intensifying Leverage and Resistance Levels

By: Eva Baxter

The cryptocurrency market, particularly XRP, is currently facing significant challenges as it attempts to stabilize amid underlying market pressures. Recent reports indicate that XRP’s price dynamics resemble conditions last seen in February 2022, marked by shifting cost-basis arrangements that are weighing heavily on market sentiment.

XRP's on-chain analysis by Glassnode reveals that current market structures echo the precarious setup from early 2022. This setup originally saw short-term buyers accumulating beneath the realized prices of longer-term holders, a condition that fosters persistent selling pressure. Realized profit and loss patterns are indicating significant distribution into rallies, adding complexity to XPR's recovery efforts. Glassnode's insights point out that newer buyers now hold a better average entry point than previous "top buyers," creating psychological challenges for those underwater holders left in precarious positions.

The leveraged trade landscape is further exacerbating market volatility. A substantial wave of long liquidation events, particularly on platforms such as Binance, has rattled the market, highlighting the fragility underpinning XRP's current state. As geopolitical factors elevate macroeconomic uncertainty, ripple effects across the crypto market amplify these existing pressures, trapping leveraged positions. Open interest in XRP remains notable, yet not sufficiently extreme to hint at an immediate unwinding, suggesting potential market preparedness for further swings.

Market technicals underline resistance and support struggles. Although attempts have been made to recover above the $2.00 threshold, the presence of strong resistance lines and the inability to hold gains have left bulls reeling. Defining market movements towards the $1.85 to $2.00 zone has emerged as a critical momentum pivot. Analysts forecast that sustained pressure on this range without bullish catalysts could yield additional downside tests. Looking forward, although new acquisitions by institutions and Ripple’s strategic developments may provide longer-term support, in the near-term, continued cautious positioning suggests existing investors remain vigilant amidst volatile conditions.