Multiple technical indicators suggest XRP’s price may surge towards $3 in the upcoming days, prompted by a significant drop in exchange balances, which are at their lowest in five years.

Key Points:

• A bull flag breakout and inverse head-and-shoulders pattern point towards an XRP price target of $3.
• An unexpected drop in XRP held on exchanges and record outflows signal strong buying activity.
• The 90-day spot CVD (Cumulative Volume Delta) has turned positive, indicating ongoing demand that supports a potential price rally.

The price of XRP remains on the radar as it shows various signs indicating that a rally towards $3 could happen shortly. Here’s an analysis using four technical charts to illustrate a potential breakout.

XRP Bull Flag Pattern Targets $2.97

In the four-hour chart, XRP is seen validating a bull flag pattern after surpassing resistance levels at $2.63 on Wednesday. A daily closing above this resistance could pave the way for XRP to reach a target price of $2.92, representing a 12% increase.

XRP/USD four-day price chart. Source: Cointelegraph/TradingView

Bull flags typically suggest bullish continuation, and XRP’s recent movement above this flag’s upper trendline indicates a likely resumption of upward momentum.

Inverse Head-and-Shoulders Pattern Projects $3.02

According to analysts, XRP has formed an inverse head-and-shoulders pattern on the three-hour chart, which hints at a potential price rally to $3.

This pattern consists of three troughs, with the central “head” lower than the two higher “shoulders.” A breakout above this neckline could lead to accelerated price increases.

Related: Ripple-backed Evernorth nears launch of publicly traded XRP treasury

Analyst BlockBull commented on this price action, stating:

“Could $XRP Reach $3 before Wednesday’s Fed Meeting?”

XRP/USD three-hour chart. Source: Cointelegraph/TradingView

The estimated target for the inverse head-and-shoulders pattern is set at $3.02, a 14% rise from the current price.

Analyst Altcoin Gordin highlighted that a “perfect move up from the right shoulder” indicates XRP could surpass $3.

Cointelegraph previously reported that XRP is showcasing significant bullish signals, with Evernorth’s accumulation of $1 billion and notable exchange outflows boosting expectations of a rise towards $3 in November.

Decreasing XRP Supply on Exchanges

In the past month, the quantity of XRP on exchanges has notably dropped, as indicated by Glassnode’s data. The below chart illustrates a decrease of 1.4 billion tokens, bringing the total balance down to 2.57 billion on Wednesday.

XRP reserve on exchanges. Source: Glassnode

This reduction hints at a lack of intent to sell among holders, which could strengthen upward momentum for XRP.

Furthermore, record outflows—2.78 million XRP net position changes on centralized exchanges—have been reported, marking the highest historical decline.

Such outflows typically signify substantial accumulation by major holders, minimizing immediate sell-side pressure while amplifying the potential for XRP’s rebound to $3.

Positive 90-day CVD Supports XRP Bulls

The analysis of the 90-day spot taker cumulative volume delta (CVD) illustrates the extent sellers have relinquished control since October 14.

CryptoQuant’s data indicates that buy orders have regained dominance, suggesting that more purchasing activity is ongoing in comparison to selling.

This trend indicates sustained demand despite recent price setbacks, providing signals for recovery in the market.

XRP spot taker CVD. Source: CryptoQuant

Positive CVD also reflects optimism among traders, as they are actively maintaining positions. Continuation of this trend may lead to further upward movement, reminiscent of past price surges.

Disclaimer: This article is not investment advice. Investment and trading entail risks; always conduct personal research before making any financial decisions.