Key takeaways:
XRP is forming a bearish descending triangle on the daily chart, indicating a potential 18% decrease to $2.40.
Falling daily active addresses suggest diminishing transaction activity and reducing demand for XRP.
Spot taker CVD is in negative territory, pointing to declining investor interest.
XRP (XRP) is currently trading 23% below its peak of $3.66, and various indicators suggest a possible decline towards $2.40.
According to data from Cointelegraph Markets Pro and TradingView, XRP is trading beneath a descending triangle pattern on the daily chart, depicted in the following image.
A descending triangle signifies a bearish trend, featuring a horizontal support line with a downward-sloping upper trendline.
The price dipped below the $2.95 support line of the current chart pattern on Tuesday, continuing the decline, with a projected target of $2.40.
This potential move represents an 18% drop from the current price level.
As reported by Cointelegraph, XRP must reclaim the $3 support level to prevent a deeper pullback to $2.24. The last two instances when the price regained this level were in mid-July and early August, leading to rallies of 25% and 15%, respectively.
XRP/BTC bearish divergence
The bearish trend for XRP is further corroborated by a notable bearish divergence between the XRP/BTC pair and the relative strength index (RSI).
The daily chart indicates that the XRP/BTC pair increased from July 10 to August 18, establishing higher lows.
However, during the same timeframe, the daily RSI fell from 75, an overbought state, down to 43, creating lower lows, which is illustrated in the chart below.
Related: Price predictions 8/18: SPX, DXY, BTC, ETH, XRP, BNB, SOL, DOGE, ADA, LINK
A negative divergence between declining prices and an increasing RSI usually indicates weakness in the existing uptrend, encouraging traders to realize profits at higher prices as interest wanes and buyer fatigue begins.
The above chart also shows that XRP/BTC is above a critical support range between 0.0000245 BTC and 0.0000250 BTC, supported by the 200-day simple moving average.
A breach below this threshold could lead the XRP/BTC pair to continue its downtrend, further spurred by a drop in XRP’s price.
Declining network activity could amplify XRP sell-off
The XRP Ledger has seen a marked reduction in network activity compared to Q1/2025 and from June to July. On-chain data from Glassnode indicates that daily active addresses (DAAs) on the network are significantly lower than those recorded in March and June.
The ledger saw 608,000 DAAs on March 19 and 577,134 on June 16, indicating high user engagement and transaction volume. However, there has been a substantial drop from the end of June through August, as reflected in the chart below.
With only about 33,000 daily active addresses currently, transaction volumes have diminished, possibly indicating a decline in interest or confidence in XRP’s short-term prospects.
Historically, declines in network activity often precede price stagnation, as reduced transaction volumes lessen liquidity and buying momentum.
The transaction count has similarly dropped by 51%, from 2.5 million in June to 1.25 million at the time of this writing, according to data from CryptoQuant.
Transaction counts and active addresses are commonly used to gauge user engagement within a network, yielding valuable insights into overall activity and adoption of the blockchain and its associated token.
Thus, this significant decline in on-chain indicators could push XRP’s value lower, prompting speculation that the token might experience more considerable short-term declines.
Negative 90-day CVD backs XRP’s downside
An analysis of the 90-day spot taker cumulative volume delta (CVD) evaluates the intensifying sell-side pressure.
CVD measures the difference between buy and sell volumes over a three-month span.
Since July 28, selling pressure has dominated the order book, following the XRP/USD pair’s peak at over $3.66 on July 18.
The negative CVD (indicated by red bars in the chart above) suggests profit-taking among traders, which indicates falling demand as sellers gain control.
If the CVD remains in the negative, it signals persistent selling pressure, potentially leading to further declines, as observed in past corrections.
With over 91% of the XRP supply still in profit at current levels, investors may continue to secure gains, adding to the challenges ahead.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
