XRP is currently trading near the $2.10 mark after experiencing a significant upward movement earlier this month. Following this surge, the market has cooled, and excess leverage has been cleared. Notably, XRP has formed a Golden Cross, a technical indicator that previously signaled a rally towards its all-time high of $3.68. This development raises questions about whether the pattern could repeat itself.
Leverage Reset Leads to Price Stabilization
One of the most significant developments in the cryptocurrency market occurred within the derivatives sector. XRP recently underwent a rare two-sided liquidation event on Binance Futures. On January 5, the price sharply increased, triggering approximately $4.4 million in short liquidations as late sellers were forced to exit their positions. The following day, however, the trend reversed, resulting in nearly $5.5 million in long positions being wiped out. This flurry of liquidations effectively removed excess leverage from both sides and left XRP trading within a narrow range of $2.07 to $2.17 as traders awaited a fresh catalyst.
Whale Activity Declines as Market Stabilizes
With the leverage cleared, attention has shifted to on-chain metrics and institutional signals. Data from CryptoQuant indicates that large holders, often referred to as whales, continue to dominate XRP inflows to Binance, accounting for approximately 60% of total transactions, with retail traders making up the remainder. However, whale activity has been gradually declining since mid-December, suggesting that major holders may be stepping back after months of heavy participation, allowing the market to cool and stabilize.
Institutional interest remains crucial for XRP’s support. Spot XRP Exchange-Traded Funds (ETFs) have attracted nearly $1.49 billion in inflows since their launch. Despite experiencing a $40.8 million outflow on January 7 during a recent price dip, this data indicates that while short-term sentiment may fluctuate, long-term interest in XRP has not diminished.
Analysts are closely monitoring technical indicators as well. Chart data shared by ChartNerd reveals that XRP has printed a Golden Cross on the 5-day Moving Average Convergence Divergence (MACD), with the histogram now turning positive. The last time this signal appeared was in July, just before XRP reached new highs.
If historical patterns hold true, XRP may soon approach its all-time high of $3.68, sparking renewed interest among investors. As the market evolves, the combined effects of technical indicators, institutional participation, and whale activity will be pivotal in shaping XRP’s trajectory in the coming weeks.
