XRP ($2.02) is rapidly approaching a crucial turning point as technical indicators point to fading bullish momentum. After an impressive breakout above its descending trendline on the four-hour chart, XRP initially surged, igniting hopes of a sustained rally. However, recent price behaviour suggests that excitement may be premature.

Momentum Fades After Breakout

The initial breakout brought optimism across the market as XRP climbed past a significant resistance trendline. Yet, the upward momentum didn’t last long. Price action has formed a rounded top pattern, while trading volume has noticeably declined. This weakening momentum is clearly visible on both the four-hour and daily timeframes.

The rejection near the local top and the drop in volume signals a loss of buying pressure. As XRP slides toward a confluence of short- and medium-term exponential moving averages (EMAs), traders should brace for a test of key structural support. If bulls fail to defend the $2.30–$2.26 zone, XRP could retest the breakout trendline or even slip back to $2.10.

^{Source: XRP/USDT ($1.00) Chart}

Mixed Signals from the Daily Chart

Despite the short-term weakness, the daily chart still paints a relatively bullish macro picture. XRP remains above the 100 and 200-day EMAs, and the breakout from the descending wedge pattern remains valid. This suggests that the broader uptrend has not yet broken.

Still, warning signs have emerged. A bearish divergence between price and the Relative Strength Index (RSI) indicates a lack of buyer conviction. This divergence, combined with waning volume after the breakout, raises legitimate concerns about the rally’s sustainability.

Related article: XRP Bulls Reload: Top Traders Eye $3.40 Breakout and Long-Term Surge

What Comes Next?

XRP is now at a technical crossroads. If the price closes below $2.26 on the daily chart with strong selling volume, it could signal a more profound reversal, potentially dragging the asset back into consolidation territory. Such a move would invalidate the bullish wedge breakout narrative that traders have followed over the past few weeks.

On the other hand, if XRP holds the current support band and rebounds with renewed volume, the rally could regain momentum. A sustained bounce from this zone would likely restore bullish sentiment and reinforce the long-term breakout scenario.

XRP’s current structure reveals a market in transition. While the macro trend remains technically intact, short-term signals suggest caution. Traders should closely watch the price’s interaction with support levels and monitor volume. These factors will provide the clearest clues as to whether XRP’s recent strength is just a temporary pause or the beginning of a trend reversal.

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