XRP Faces Tough Times: What's Next for the Cryptocurrency?

XRP, a popular cryptocurrency, is currently facing some challenges. It has dropped by 5%, bringing its value to $2. 38. This decline has caught the attention of traders, who are warning that if the price falls below this level, it could lead to a much bigger drop, possibly as low as $1. 80. Looking at the technical side, XRP's performance has been weakening. It's trading below its 20-day and 50-day average prices, which are $2. 52 and $2. 70 respectively. Moreover, it has been struggling to break through the $2. 85 resistance level. The price is also stuck under a downward trendline, which is part of a long-term triangle pattern. The $2. 38–$2. 40 range is now acting as a crucial support level. This means that if the price falls below this range, it could signal a continued downward trend, potentially reaching $1. 80. On the other hand, if XRP can recover and rise above $2. 70, it might regain some momentum and return to the broader consolidation range near $3. 00.In terms of trading activity, XRP saw a significant outflow of about $28. 7 million on Monday. This is one of the largest single-day outflows in recent weeks, indicating that traders are selling their XRP holdings. This consistent selling pressure suggests that both short-term and long-term holders are reducing their exposure to XRP. Looking at the derivatives market, there's a mix of signals. Futures activity has spiked by 86. 9%, reaching $6. 45 billion, which indicates increased volatility and speculation. However, open interest has fallen by 2. 4%, suggesting that some traders are closing their positions or offsetting their short exposure. The Binance long/short ratio stands at 2. 88, showing that traders are still betting on an upside. Additionally, options volume has surged by nearly 188%, with roughly $7. 8 million in long liquidations occurring over 12 hours as XRP tested lower trendline supports.