XRP faces ‘now or never’ moment as traders eye rally to $2.50
XRP (XRP) defended its $2 psychological floor this week, rebounding nearly 6% on Tuesday after a brief liquidity sweep on Monday. While the asset remained in a multimonth downtrend dating back to July, the $2.28–$2.30 resistance band now stands as the defining pivot for bullish continuation.Key takeaways:A bullish daily close above $2.30 would confirm a break of structure and possibly lead to a move to $2.58.XRP has moved aggressively between liquidity pockets in 2025, increasing the chances of an outsized rally. Mildly negative funding and weakened open interest indicate bearish conditions, but reclaiming the $2.22–$2.30 range could trigger a squeeze-driven trend reversal.XRP near key price zone as its chart structure tightensXRP’s bounce to $2.17 occurred after tapping the fair value gap (FVG) just beneath $2, an area created during the Nov. 21 rebound from $1.80. This retest suggested that buyers remain active at discounted pricing zones even within a broader downtrend. Structurally, XRP continued to print lower highs, but the compression below $2.30 resembled a coil forming under a major decision point. A daily close above $2.30 would mark the first trend shift since July, confirming a bullish break of the structure and clearing a clean path toward the next liquidity cluster at $2.58. The region between $2.34 and $2.42 is mapped as a sell-side FVG, where early profit-taking is likely. However, XRP’s historical price behavior in 2025 has been characterized by forceful moves from one extreme liquidity pocket to the next. This means that once momentum flips, XRP tends to overshoot intermediate resistance as it hunts liquidity, making $2.58 an extended target.The relative strength index (RSI) leaned modestly bullish, and a reclaim of the 200-period simple moving average (SMA) would provide strong confirmation. Meanwhile, futures open interest has collapsed from $8.6 billion to $3.8 billion in Q4, suggesting that when a directional expansion arrives, it could unfold rapidly due to thinner positioning.Related: Daily crypto liquidations nearly triple as leverage overheats: GlassnodeFunding dynamics and trader sentiment are splitAnalyst Pelin Ay highlighted that XRP funding rates remain predominantly negative, indicating short positioning dominates the futures market. With both price and funding declining together, sentiment is reinforcing the downtrend, raising the probability of a retest of the $2.00–$1.90 zone unless structure shifts. If funding drops below –0.01, Ay believed the path toward $1.90 becomes increasingly likely. Still, deepening negative funding often precedes liquidity raids. In that scenario, XRP could briefly consolidate before driving above $2.30.Meanwhile, Crypto trader Dom noted signs of an emerging reversal. The trader noted that inverting XRP’s chart revealed a clear three-drive exhaustion pattern over the past six weeks, suggesting trend fatigue. A higher low has finally printed, and reclaiming the monthly rVWAP (relative volume-weighted average price) at $2.22 would signal that bullish rotation is underway, paving the way toward the $2.50 region. However, the trader warned, “Orderbooks are clear, if there was a time, it's now for this trend to shift. If this setup fails, acceptance under $2 is next and the end of year is ugly.” Related: Bitcoin’s strongest trading day since May cues possible rally to $107KThis article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.