
Key Highlights
- XRP may drop by 15% towards $2.60 if it fails to hold the $3 support level.
- Over $500 million in long positions below $3 could lead to a swift sell-off.
XRP has often bounced above the $3 mark following its surge in November 2024. However, each surge resulted in a sharp retraction. Recently, the token faltered below this important support level, which coincides with its 200-period exponential moving average.
XRP/USD four-hour price chart. Source: TradingView
Will XRP continue to fall? Let’s explore the data.
XRP Chart Pattern Signals a Possible 15% Drop
A bearish chart pattern suggests XRP might drop 15% to around $2.60. In September, XRP reached a rounded peak before entering a triangle consolidation pattern and slipping sharply.
XRP/USD four-hour price chart. Source: TradingView
A similar trend appears to be forming in October, marking a new rounded peak while consolidating within a bearish flag structure, typical of further declines.
With the four-hour Relative Strength Index (RSI) indicating overbought conditions, further price drops may be on the horizon.
Related: XRP price reclaims $3, potential 40% gains in October
Testing the flag support at $2.93 will be crucial. A close below might confirm a breakdown, leading to a target of $2.60. This scenario aligns with the 200-day EMA support.
XRP/USD daily price chart. Source: TradingView
A rebound from the 20- or 50-day EMAs could potentially negate the bearish outlook, setting the stage for another attempt at $3.
The $500 Million Long Liquidation Potential
XRP’s position around $3 is critical as it lies between two substantial liquidity zones, as observed in CoinGlass.
While long liquidation levels cluster around $3.18 to $3.40, heavy liquidation pools exist beneath $3, notably between $2.89 and $2.73, exceeding $500 million. A firm close below $3 could lead to a significant liquidation cascade.
To sum up, the market’s behavior is highly dependent on maintaining the $3 level. If stable, we may see a stop run upwards, otherwise a serious sell-off looms.