#CryptoMarketWatch

XRP Price Needs to Repeat Four Months Ago for a 33% Rise

XRP has been one of the relatively weaker cryptocurrencies this week. Its price has fallen by approximately 6% in the last seven days, weighing on short-term investor sentiment.

However, this recent pullback doesn't seem to be over. Chart and on-chain data indicate that XRP is currently at a crossroads: its direction will depend on whether or not a similar scenario to what happened four months ago can be repeated.

Price Chart Shows a Familiar Pattern

XRP is approaching the formation of an inverse head and shoulders pattern on the daily chart. While these patterns often signal a trend reversal, they only become meaningful if certain resistance levels are recaptured. Currently, the neckline of the pattern is around $2.52, approximately 28% above the current price.

For this upward path to open, XRP first needs to reclaim the sky-blue line, which is the 100-day exponential moving average. The EMA, giving more weight to recent prices, reacts to trends faster than the simple moving average. In the past, this level has served as a crucial decision point for XRP. Reclaiming the 100-day EMA in September resulted in a gain of approximately 12%. A similar move earlier in the same month led to a 16% rally.

So far, XRP has failed to hold above the short-term EMAs (20-day and 50-day) and was rejected again from the 100-day EMA on January 14th. However, a long lower wick formed during the recent sell-off, indicating that buyers quickly absorbed the downward pressure. This reaction suggests that demand is still strong and the bullish structure is currently being maintained. Of course, this can only continue once the EMA barrier is broken.

Whales and Holders Took Early Positions: Spot Buying Alone May Not Be Enough

On-chain data points to a deeper picture. Whales holding between 10 million and 100 million XRP increased their total holdings from approximately 11.14 billion to 11.17 billion tokens. This is equivalent to about $60 million at current prices.

Slightly smaller whales (those holding between 1 million and 10 million XRP) were even more active. Their holdings increased from approximately 3.54 billion to 3.59 billion XRP, almost $100 million. These purchases occurred around January 14th, before the mass accumulation began. While there were small sell-offs on January 15th when the XRP price started to correct, a net increase in the overall balance has continued since January 14th.

Whales were followed by smaller investors. Since January 16th, the net position change of long-term holders has clearly turned positive. This metric, tracking wallets holding XRP for approximately 155 days or more, represents investors exhibiting commitment rather than short-term traders.

On January 16th, this group held approximately 223,201,195 XRP. As of January 18th, this figure had risen to 234,886,841 XRP. This represents an increase of approximately 11.69 million XRP in about two days, or 5.2% growth.

Timing is crucial. While whales are taking positions in the initial correction, long-term holders are stepping in after January 16th. This gradual accumulation indicates planned and determined purchases rather than panic selling.

Things are developing differently in the derivatives market. Short position liquidation leverage in XRP perpetual markets is around $520 million. For long positions, this figure is only $22 million. This means that currently, more than 95% of positions are concentrated on the short side.

This imbalance is like a powder keg. A small upward move could trigger a short squeeze, rapidly increasing price momentum. The market could become volatile, especially if the main resistances are broken.

The levels are clear. For XRP to confirm its gains and reclaim the 100-day EMA, it needs to close above $2.24. If it succeeds, it could advance to the $2.48-$2.52 range, triggering the formation. In such a scenario, the possibility of a 33% upside would resurface.

On the downside, a loss of $1.84 weakens the outlook, while a drop below $1.77 completely invalidates it. Currently, XRP is unable to break out. However, if the September move is repeated, the expected rally could begin.