Is XRP Price Going to Crash Again? Analyzing Key Market Signals
XRP has been on a rollercoaster ride in recent weeks, with its price surging by over 40% to reach $2.28 on April 29. However, it remains significantly below its all-time high of $3.39, leaving investors wondering: Will XRP sustain its recovery or face another crash? Let’s dive into the key technical and on-chain indicators that could determine XRP’s next move.
Key Takeaways
- XRP trades over 120% above its realized price, flashing heightened correction risk.
- A rising wedge breakdown on the 4H chart could send XRP toward $1.89 by mid-May.
- Weekly falling wedge pattern and 50-week EMA support suggest a possible 25% recovery to $2.92 by June.
XRP’s Rising Wedge Flashes Selloff Risks
XRP is showing signs of a potential breakdown as a rising wedge pattern forms on its 4-hour chart, raising the risk of a sharp short-term correction.
As of April 29, XRP trades around $2.29, hovering near the wedge’s upper resistance. The pattern, defined by converging upward-sloping trendlines, typically signals weakening bullish momentum and a likely trend reversal.
A confirmed breakdown below the wedge’s lower support could push XRP toward $1.89, down about 17% from current levels, by mid-May.
Supporting the bearish outlook is XRP’s relative strength index (RSI), which sits near 60, indicating that it’s approaching overbought territory, which may lead to profit-taking by traders.
XRP Realized Price Signals Overvaluation
XRP’s current realized price (aggregated) of $1.02 represents the average acquisition cost of all circulating tokens. It serves as a key indicator of market sentiment, helping to identify periods of overvaluation or undervaluation.
As of April 29, XRP was trading around $2.28, more than 120% above its realized price. Historically, when XRP trades far above its realized price, it tends to reflect speculative euphoria and elevated risk.
In early 2018 and mid 2021, huge divergences between XRP’s spot and realized price preceded sharp corrections toward the realized price target, as shown above. In 2025, the gap between spot and realized price has increased similarly.
If bullish momentum weakens, XRP may face increased selling pressure, potentially retracing toward the realized price level near $1.02, down by over 50% from the current price levels.
Bullish Counter-Indicators: The Falling Wedge Pattern
XRP is flashing signs of bullish continuation as it holds firmly above its 50-week exponential moving average (EMA) near $1.67, a level that acted as resistance throughout the 2022-2024 bear cycle and is now serving as strong support.
Additionally, XRP is forming a classic falling wedge pattern on the week chart, a structure often associated with bullish reversal breakouts.
The tightening price range suggests declining selling pressure, with a potential breakout looming if bulls manage to push price above the wedge’s upper trendline.
Related: XRP futures open interest surges by 32% — Are traders bullish or bearish?
A successful breakout could target the $2.92 level by June, marking a 25% rally from the current price. Supporting this outlook, the RSI has bounced from the midline, indicating a potential return of buying momentum.
Market Sentiment and Institutional Interest
Beyond technical patterns, XRP’s price trajectory will likely be influenced by broader market sentiment and institutional interest. Recent weeks have seen:
- Increased futures open interest: A 32% surge suggests growing trader participation
- Regulatory clarity: The resolution of Ripple’s SEC lawsuit removed a major overhang
- Adoption metrics: Growing use in cross-border payments could provide fundamental support
However, the cryptocurrency market remains highly correlated with Bitcoin’s movements. Any significant BTC pullback could drag XRP lower regardless of its individual technicals.
Historical Price Action: Lessons From Previous Cycles
Examining XRP’s historical performance reveals several important patterns:
| Period | Price Action | Key Lesson |
|---|---|---|
| 2017-2018 | Rallied to $3.40, then crashed 90%+ | Extreme volatility is characteristic |
| 2020-2021 | Recovered to $1.96 before SEC lawsuit impact | Regulatory news can override technicals |
| 2023-2024 | Established $0.30 as strong support | New institutional buyers may provide floor |
These historical patterns suggest that while XRP can experience dramatic crashes, it has consistently found buyers at progressively higher levels during each market cycle.
Conclusion: Navigating XRP’s Volatility
XRP currently presents a mixed technical picture with compelling arguments on both sides:
- Bear case: Rising wedge pattern and overextension above realized price suggest 17-50% downside potential
- Bull case: Falling wedge and strong EMA support indicate possible 25% upside to $2.92
Traders should watch these key levels:
- Support: $1.89 (wedge target), $1.67 (50-week EMA), $1.02 (realized price)
- Resistance: $2.50 (psychological level), $2.92 (wedge target), $3.40 (ATH)
The coming weeks will be crucial in determining whether XRP’s recovery has staying power or if another correction is imminent. As always in cryptocurrency markets, risk management remains paramount.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
