XRP has entered a prolonged consolidation phase, trading sideways beneath a key resistance zone. The muted price action is not random. Derivatives data suggest a heavy concentration of short contracts is capping upside attempts.
This resistance wall has created tension in the market, highlighting the question of whether XRP can trigger a short squeeze or remain suppressed below $1.50.
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XRP Is Facing a Wall
Futures market data and liquidation heatmaps highlight a critical level near $1.51. At that price, approximately $47 million in XRP short positions face liquidation. This concentration creates a tangible barrier, capping any attempts for XRP to break above its current price range.
Traders holding short contracts are incentivized to defend this crucial resistance level. A breakout could force rapid short covering—essentially a scramble by short sellers to close their positions—which might lead to a temporary price spike. However, historical patterns suggest that such moves often exhaust buy-side liquidity quickly. Large players might seize the opportunity to sell into strength, turning what should be a support level into a short-term ceiling instead.
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On-chain data reveals ongoing stress among XRP holders. Recent metrics of net realized profit and loss show that investors are still liquidating at a loss. On February 17 alone, approximately $117 million in realized losses were recorded, reflecting widespread capitulation among investors.
This level of selling pressure indicates persistent fear in the market. When holders exit their positions at a loss, it signals a decreased confidence in a near-term recovery. Such sustained loss realization can constrain any bullish momentum until the selling pressure eases and investor sentiment improves.
XRP Holders Mature
Amid this ongoing distribution, a resilient subset of holders is emerging. Many XRP investors, despite remaining underwater, have chosen to HODL rather than liquidate. This behavior suggests a growing conviction among mid-term investors, who may believe that the current price levels represent an attractive entry point.
Interestingly, the segment of holders keeping their assets for three to six months has expanded significantly. Their share of the total XRP supply has risen from 8% to 15%. As these wallets mature and holders resist the urge to sell, this dynamic may counterbalance the panic-driven distribution and could help stabilize price action over time.
XRP Price To Likely Consolidate
As of now, XRP is trading at approximately $1.43, below the critical $1.51 resistance, which aligns closely with the 61.8% Fibonacci retracement level. Successfully reclaiming this barrier as support could signal a technical improvement and potentially spark a price recovery. However, the prevailing sentiment suggests that consolidation around this level may be more likely.
Key support zones are found at $1.44 and $1.27. Should selling pressure from loss-making investors persist, XRP could remain range-bound between these thresholds. The continued rejection near $1.51 may reinforce this sideways structure, limiting any significant upward movement.
However, the cryptocurrency market’s sentiment can shift rapidly. If short sellers lose their grip and $1.51 transforms into a support level, the potential for upward movement increases significantly. A breakout could push XRP above $1.62, attracting momentum buyers and potentially invalidating the current bearish narrative. Such a scenario would substantially alter the short-term market structure, providing a fresh outlook for investors watching XRP closely.
