XRP is indeed consolidating in what analysts are calling an “exhaustion zone” after a significant downturn, with the market’s next move hinging on a battle between key technical levels and upcoming catalysts.
A Market in a Precarious Balance
XRP recently extended its decline, sliding 2% in the October 16-17 session to trade around $2.36. This drop is part of a broader correction, with the token having fallen 22% over the past week and 34% from its recent highs, pushing it into a zone that often precedes a potential reversal or continuation.
The market shows conflicting signals. On one hand, there are signs of investor exhaustion and capitulation. Data indicates that long-term holders have reduced their positions by 34% over the past two weeks, a clear sign of divestment. On the other hand, this selling pressure is being met with institutional accumulation at current levels. Despite the price drop, open interest in derivatives markets rebounded to $1.36 billion, suggesting traders are rebuilding exposure and possibly positioning for a rebound.
Key Levels and Conflicting Analyst Views
For traders and treasury desks, specific price levels are critical in determining the next major move.
The immediate technical picture points to a tight consolidation range. Analysts identify strong support between $2.31 and $2.35, a zone that has already seen strong spot demand and algorithmic buying. On the upside, the first significant resistance sits at $2.47; a clean and sustained break above this level is needed to invalidate the near-term bearish setup and open a path toward $2.55. A failure to hold the $2.31 support could signal a deeper correction toward $2.18 and even $2.02.
Beyond these short-term levels, analyst opinions on the long-term trajectory diverge significantly. Some technical analysts, like HovWaves, project a highly optimistic roadmap that could see XRP rally to $8, contingent on the completion of a specific Elliott Wave cycle. Others, like analyst Steph, point to a bearish RSI divergence on the weekly chart that mirrors the pattern preceding the 2021 price collapse, suggesting a need for caution. For Steph, a weekly close above $2.65 is essential to confirm a bottom is in.
Catalysts for the Next Major Move
The market is currently in a state of equilibrium, waiting for a fundamental spark. Two primary catalysts could determine the direction of the next significant move.
The most immediate potential driver is regulatory progress, particularly the SEC’s decisions on multiple spot XRP ETF filings expected in October. An approval could unlock substantial institutional demand and act as a powerful bullish trigger. Furthermore, the planned launch of an EVM-compatible sidechain in Q4 2025 could expand the network’s utility and draw fresh developer and user demand.
In the meantime, the broader macroeconomic environment will also play a key role. Recent interest rate cuts by the Federal Reserve have improved liquidity conditions, which can boost risk assets like cryptocurrencies. Market desks suggest that tactical long positioning is already beginning in anticipation of quarter-end ETF speculation and continued macro easing.
