XRP fell to $2.27 after breaking beneath the $2.32 support level, but a significant volume spike down to $2.21 attracted buying interest and stabilized the drop—prompting traders to consider whether this rebound can reclaim $2.31-$2.32 or if the market remains within a descending channel.
News background
XRP traders are assessing a short-term price dip against a longer-term bullish outlook on the XRP/BTC ratio.
Chart analyst “The Great Mattsby” suggested that XRP/BTC is nearing a breakout above the monthly Ichimoku cloud for the first time since 2018, a shift that historically indicates XRP may outperform bitcoin if confirmed. This setup is gaining attention as cross-asset rotation themes begin to resurface early in the year, even though spot markets remain sensitive to liquidity shifts and stop-driven movements.
This relative-strength context is significant because XRP’s recent selloff was driven by forced selling rather than a gradual decline — a type of movement that often resets positioning and lays the groundwork for a more stable technical base if buyers can maintain crucial levels.
Technical analysis
XRP declined 5% over the 24 hours leading up to Jan. 7 at 02:00, falling from $2.39 to $2.27 after breaching the $2.32 support and extending a descending channel that has restricted recent recoveries.
The critical moment occurred at 16:00 on Jan. 6, when volume surged to 256.3 million (142% over the 24-hour SMA), with the session’s low at $2.21. This spike resembled a capitulation-style flush: aggressive selling occurred, but there was no significant follow-through to drive the market lower than $2.21, indicating demand absorbed the selloff.
From this point, XRP tried to rebound but was met with resistance near $2.31, solidifying that range — along with the broken $2.32 level — as the primary resistance band. The failure to reclaim that range keeps the near-term outlook bearish, even though the market appears to be stabilizing after the high-volume low.
Recent short-term activity suggests a base may be forming. The 60-minute structure exhibited several attempts to hold the $2.258-$2.260 area, with higher lows emerging after the 01:33 low at $2.257. Buying activity concentrated during upward pushes, while pullbacks occurred on lighter volume—a promising sign, but still within an overarching downtrend until $2.31-$2.32 is recaptured.
Price action summary
- XRP dropped from $2.39 to $2.27, breaking below $2.32 support
- The session low occurred at $2.21 during a 256.3M volume spike (142% above the average)
- Recovery efforts have consistently stalled near $2.31, maintaining the descending channel
- Intraday stabilization has formed around $2.258-$2.260, with buyers repeatedly defending this range
What traders should know
The trade setup is straightforward: $2.21 is the critical line, and $2.31-$2.32 is the threshold.
- If $2.21 holds and XRP can reclaim $2.31-$2.32, it would appear as a high-volume shakeout followed by a trend resumption attempt—potentially paving the way back to $2.39, where overhead supply from the breakdown resides.
- If $2.21 fails, the capitulation low could shift from being a support level to a trigger for further selling. This scenario would likely incite another wave of liquidation-style selling into the next demand zone (which traders typically determine using past consolidation areas and market structure rather than relying on a single indicator).
Another aspect to monitor is XRP/BTC: the monthly Ichimoku setup noted by Mattsby serves as a relative strength indication, rather than a guarantee for spot price—however, if XRP/BTC confirms the breakout, it raises the likelihood that dips in XRP will be purchased more aggressively compared to dips in bitcoin, particularly during phases of risk-on rotation.
