XRP’s head-and-shoulders pattern is currently at a critical juncture, testing key support and resistance levels. The cryptocurrency is trading at $2.26, reflecting a 3.26% decline at the time of writing. The price action is nearing the neckline of a head-and-shoulders pattern, with the left shoulder forming in late 2024 and the head reaching its peak in December.
Investors are closely monitoring whether XRP can avoid closing below the neckline and rise above the right shoulder to invalidate the bearish pattern. A successful breakout could potentially push the price towards $5, signaling a bullish trend. However, failure to break above the resistance level could reinforce the bearish outlook for XRP.
Key support for XRP is currently at $2.02, while resistance near $2.95 poses a significant barrier for the cryptocurrency’s price movement. The market is expected to react strongly around these levels, determining the next direction for XRP.
Despite the price fluctuations, XRP has seen a rise in daily active addresses, reaching over 206K on March 9, 2025. This increase indicates growing engagement with the network, which could support a bullish outlook for XRP. However, the declining transaction count, currently at 604K, suggests weakening momentum and less market interest in the short term.
The MVRV ratio for XRP has slightly dropped to 2.92, signaling a cooling off period after recent gains. While the ratio remains positive, the decrease hints at potential overbought conditions. This, coupled with the declining transaction count, suggests a bearish continuation for XRP in the near term.
In conclusion, XRP is facing challenges in maintaining upward momentum, with indicators pointing towards a bearish continuation. The head-and-shoulders pattern, coupled with declining transaction activity and a drop in the MVRV ratio, signal potential downside if key resistance levels are not breached. The market sentiment will play a crucial role in determining XRP’s future price movements.