XRP Faces Deeper Pullback as Capital Rotates Elsewhere

XRP’s showing notable relative weakness as the broader crypto market enters a consolidation phase, with price action deteriorating faster than most large-cap assets. While Bitcoin and Ethereum have transitioned into sideways absorption, XRP has moved into a clearer corrective structure.

On higher timeframes, XRP has failed to sustain its prior breakout zone and is now trading below key moving averages that previously acted as dynamic support.

It’s worth noting that the loss of this structure suggests the prior impulsive leg has fully resolved. Therefore, shifting price behavior from trend continuation to range repair.

Unlike Bitcoin, which continues to hold macro support, XRP is currently moving into lower acceptance zones, indicating weaker conviction among buyers.

Derivatives Reinforce This shift

Open interest across major venues has declined steadily. Moreover, it might signal that leverage is being actively reduced, which is a behavior that usually appears during corrective phases where traders step aside.

On the other hand, funding rates remain muted, confirming that the move lower is not driven by excessive short positioning, but by a lack of sustained demand.

Furthermore, on-chain flows add an extra layer of context to this narrative. While the asset has experienced notable exchange outflows in the past, recent price rebounds aren’t accompanied by a renewed acceleration in withdrawals.

Instead, exchange inflows have increased relative to short-term averages, indicating that supply is returning to exchanges during periods of strength.

Therefore, suggesting distribution pressure, especially when compared to other assets, where coins continue moving off exchanges during pullbacks.

*XRP exchange outflows remain elevated even as price consolidates, signaling continued token withdrawals from trading venues.*

Long-Term Structure Still Intact

The current behavior does not signal a broader breakdown in XRP’s long-term structure. Instead, it reflects a rotation phase where capital seems to favor assets with stronger momentum, while lagging tokens reset too much positioning.

For XRP to become stable, it will likely require sustained holding above the reclaimed support levels. Also, the altcoin will need improved spot demand and declining exchange balances.

However, and because it’s important to mention it, XRP’s price action in the near term remains corrective and not catastrophic. Moreover, the asset is digesting prior gains within a cooling market environment.

For XRP to access renewed upside, traders need to check how capital flows, leverage, and spot demand realign in further sessions.