XRP Price Analysis Powered by AI

XRP Approaches Exhaustion: Overbought Surge Sets Up Short-Term Bearish Opportunity

Long-Term Uptrend: XRP has shown a significant and sustained rally since mid-May 2025. The price moved from the $2.10–$2.20 range in mid-June to recently surpassing $3.50. The latest candles show strong bullish momentum, particularly from July 10 to July 18.
Volume Confirmation: Breakouts are coupled with surging volume – e.g., the jump from $2.70 to $2.95 on July 11, and the explosive rally to $3.54 on July 17–18—over 21B in volume, confirming institutional participation and likely FOMO.
Recent Correction: After peaking at $3.65 on July 18, price pulled back to $3.43. The size of the retracement relative to the upswing suggests a healthy pause or short-term profit-taking, rather than full trend reversal.

Bullish Engulfing/Marubozu: Strong green candles July 16–17 and early July 18, showing minimal upper/lower wicks—classic momentum signals.
Upper Wicks & Doji Sequence: On lower timeframes (last 8–12 hours), frequent upper wicks and occasional dojis (e.g., price rejecting above $3.50, $3.53) show sellers are stepping in, indicating resistance and partial exhaustion of immediate buying pressure.
Support Formation: $3.36–$3.38 (intraday lows on July 18) repeatedly held as a support zone during pullbacks.

20/50 EMA (Estimated): Price is significantly above the 20 and 50-period moving averages, confirming short- to medium-term bullish trend.
200 EMA (Support): Projected 200 EMA is likely around $2.90–$3.10, well below current price, underscoring over-extension but also strong underlying bullish sentiment.

RSI Likely 75–85: Massive rally suggests overbought conditions. Typically, an RSI in this range signals likely short-term corrections or sideways consolidation as buyers digest gains, but sharp parabolic markets can remain overbought for extended periods.

Bullish Cross Confirmation: The MACD line would be accelerating above the signal line, but with histogram starting to taper as momentum slightly cools—consistent with a short-term cooldown after a blowoff top.

Price Touched/Pierced Upper Band: Sharp expansion of the bands; price spent considerable time hugging or piercing the upper band, a classic sign of volatility climax and potential mean reversion.

The rapid move from $3.05 to $3.65 in less than 24 hours is characteristic of a blow-off or parabolic top. After such moves, markets often undergo a consolidation phase or a sharp, yet controlled, retracement to prior support/fibonacci retracement levels (0.38–0.5 typically).

Buyer exhaustion is visible in the repeated rejection candles around $3.50–$3.54. Sideways and slightly descending price action in the past 6–8 hours indicates increased selling activity and lack of fresh buyers at these levels.

Climax Volume at Peaks: Largest volumes coincide with sharp upward candles, then diminish during sideways price action, suggesting buying activity is being replaced by profit-taking/selling.
Support Volume Pockets: Major pullbacks have found buyers at $3.36–$3.38, as shown multiple times during July 18’s trading day.

Likely Large Sell Walls: The repeated failure to close meaningfully above $3.53–$3.54 suggests institutional or algorithmic sell walls—likely defense of recent highs.
Retail FOMO Waning: The initial burst in volume followed by unwind is consistent with post-breakout retail FOMO, now pausing as uncertainty increases.

0.236 Level (~$3.39–$3.40): Current pullback is testing this first Fibonacci level from the $3.05–$3.65 rally. Further weakness could see a drop to the 0.382 ($3.27–$3.30), which would be a healthy retracement and fresh buying opportunity.
Upside Fibonacci Extensions: If buyers return, next rallies may target $3.65–$3.70, then $3.80.

High Realized Volatility: Price range exceeded $0.30 in the last 24 hours, much higher than the 2-week average. This is typically unsustainable without significant news.
ATR (Estimated 1H): $0.06–$0.09—suggesting wide swings are likely in the coming session.

Wave 3/5 Completion: The recent n-shaped impulse leg likely finished a wave 3 or even wave 5, with a corrective (ABC or flat) phase now in progress.

Parabolic rallies in crypto (including XRP) are often followed by 10–15% retracements before basing anew. In XRP’s history, such retracements are typically swift and sharp.

With overbought momentum, fading volume at the new highs, prominent upper wicks, and the classic post-parabolic distribution, a short-term retracement or even a mild correction is likely before the next leg higher.
Price will likely retest $3.36–$3.38 (support). Failure here opens further downside to $3.27–$3.30 (Fib 0.382 and previous consolidation).
Upside risk is capped by heavy resistance at $3.54–$3.65, with frequent rejections expected should the price attempt to revisit those levels.

The optimal strategy is to look for shorting opportunities on minor relief rallies ($3.45–$3.48 range), targeting a pullback to $3.32–$3.35 in the next 24 hours.
Stop loss for shorts should be above $3.54 (the local high and supply zone).

Summary:

The rally in XRP has reached over-extended technical conditions, with classic signs of a short-term top forming. A retracement to more sustainable support is probable in the next 24 hours, providing an optimal risk-reward for a short-trade setup.