XRP price warning signal appeared after pumping 300% in two months

The price of XRP has pumped by more than 300% in the past two months, with a trading price of $2.10 on December 27th. However, warning signals indicate that XRP/USD may erase at least 25% of its gains in the short term.

XRP is approaching a breakout of the descending triangle

The recent decline of XRP is due to its price trading within a descending triangle pattern, which is a bearish structure that typically indicates further decline.

This pattern is defined by a series of lower highs, forming a descending trend line of a triangle, while the $2.10 level acts as horizontal support.

A decisive break below the $2.10 support level could open the door for a deeper correction. According to technical analysis rules, the potential downside target for this breakout is calculated by subtracting the height of the triangle from the breakout point.

In other words, the price of XRP may fall to around $1.64 in January 2025, a decrease of about 25% from the current price level.

XRP whale sell

Onchain data further supports the bearish outlook, and the indicator tracking whale addresses reveals distribution sentiment.

It is worth noting that since the beginning of December, the supply of XRP held by the wealthiest investors (those holding over 1 million tokens) has decreased by 180 million tokens.

At the same time, the supply held by entities with a balance of 100,000 XRP decreased by 170 million. The decrease in supply from these two address groups is consistent with XRP's price dropping more than 26% from its local high of $2.90.

Large-scale whale selling may put downward pressure on prices as the circulating token supply increases. Combined with the price drop, this indicates that the selling activity has exceeded demand.