XRP Price Flashes Early Recovery Signals as Sell Pressure Starts to Fade

XRP is showing tentative signs of stabilization across the broader crypto market, even as price remains well below recent highs. As of Jan. 21st, XRP is trading near $1.95, up modestly on the day but still locked inside a larger corrective structure that began earlier this month.

While momentum remains fragile, on-chain and derivatives data suggest that downside pressure may be easing. On the other hand, overall sentiment among market participants points to an acceleration to the downside.

On-Chain Data Points to a Developing Base

From a technical perspective, XRP’s daily chart shows price attempting to reclaim short-term structure after defending the $1.70 – $1.75 support zone.

Moreover, this area aligns with prior consolidation zones from late December and has now acted as a demand floor twice in January. However, the price remains below the $2.31 resistance, where both the 50-day and 100-day moving averages are currently converging.

On a weekly timeframe, upside attempts seem limited as XRP remains in a corrective phase following a rejection near the $3.60 highs. However, it’s still holding well above the long-term trend base. Therefore, the broader structure doesn’t necessarily point to a breakdown.

Additionally, CryptoQuant data from Binance shows that exchange inflows have declined sharply since the early January spike. Signaling reduced urgency to sell into weakness.

Meanwhile, active address data shows network participation holding steady, with no collapse in user activity during the recent pullback. Also, funding rates remain neutral, reinforcing the idea of balance returning to the market.

*Glassnode’s Active Addresses chart shows sustained network usage despite recent price weakness, suggesting underlying activity remains resilient.*

XRP Current Outlook

For the remainder of January, XRP’s outlook depends on whether the price can reclaim the $2.20 – $2.30 region on a daily closing basis. Indeed, a sustained move above that zone could open the door to a retest of $2.60, where prior distribution occurred.

In this scenario, improving market sentiment and continued reduction in exchange inflows would support a gradual recovery rather than a sharp rally.

However, failure to hold above $1.75 would shift focus back to deeper support near $1.60, where long-term buyers previously stepped in. Today, the balance of data favors stabilization over continuation of the selloff.

While XRP hasn’t confirmed a trend reversal yet, the combination of defended support, declining sell pressure, and steady network activity suggests the asset might be transitioning from distribution into a period of price compression.