XRP Takes a Breather After Skyrocketing—Temporary Dip or Rally Fatigue?

XRP's bull run hits a speed bump as prices retreat from recent highs. Traders are left wondering: Is this just healthy consolidation or the first sign of exhaustion?

Market psychology at play—The classic 'buy the rumor, sell the news' pattern emerges as XRP cools off. Meanwhile, Bitcoin maximalists are already smugly adjusting their 'I told you so' spreadsheets.

Technical check-up—Key support levels loom below. A hold here could signal another leg up, while a breakdown might confirm the bears are back in town. Either way, leverage traders are getting their usual margin calls.

The institutional angle—With Ripple's legal saga fading in the rearview, traditional finance still can't decide if they're 'cautiously optimistic' or just cautiously collecting consulting fees.

Final thought: In crypto, even pullbacks move at 3x speed. This isn't your grandpa's market correction—it's a high-frequency emotional rollercoaster with extra volatility sprinkles.

In Brief

• XRP reached a new all-time high at $3.65, marking an unprecedented peak in over seven years.
• The crypto then dropped 15% amid a broader altcoin pullback.
• Despite record growth in US monetary liquidity, the crypto market struggles to capitalize on it.
• XRP’s new peak is seen by some analysts as validation of Ripple’s regulatory strategy.

A peak reached, then erased: a sharp return to reality

Last week, XRP briefly rekindled bullish momentum by breaking a new record at $3.65, the first time in over seven years. However, this feat was quickly overshadowed by a sharp 15% drop, bringing the crypto back to $3.09 according to CoinGecko data.

This decline fits into a general pullback movement among altcoins, with assets like Solana and Dogecoin also falling. “We observe very violent upward moves, which then lead to sharp corrections, a phenomenon less frequent in traditional markets,” explained Katie Talati, research director at Arca.

This decline comes even as the macroeconomic context appeared to offer a favorable environment for risky assets. Yet, despite a strongly expanding US money supply (M2 reached a record $22,020 billion in June, up 4.5% year-on-year), the crypto market does not react positively. Several factors explain this disconnect:

• A general exhaustion of the altcoin market after a series of rapid and violent increases;

• Quick profit-taking by investors after XRP’s new peak;

• Awaiting a Fed decision on a possible rate cut, which could unlock a new liquidity flow;

• A climate of persistent uncertainty despite the record rise in overall liquidity in the US.

According to Katie Talati, these factors create tension throughout the market. Assets like XRP become more vulnerable to technical retracements even during apparent monetary support periods.

An evolving asset: between regained credibility and popular support

The peak reached by XRP is not solely technical or speculative. It is also seen by some as a strong signal, reflecting a change in perception towards Ripple and its project. “It is a validation of everything they have implemented and defended,” said Matt Kreiser, analyst at Messari.

He points out that XRP missed the peak of the previous 2021 bull market, unlike other major altcoins. This new record thus marks a possible catch-up, supported by Ripple’s strategy to build an institutional blockchain compliant with regulatory frameworks.

In this context, XRP’s appeal to retail investors remains a key factor. According to Katie Talati, XRP “has always been a favorite among retail investors,” and this support could intensify after the resolution of the legal dispute with the SEC.

This long-running litigation, now closed, offers the asset a “de-risked” image likely to attract new buyers. However, this optimistic picture is nuanced by a sign that did not go unnoticed. Chris Larsen, Ripple’s co-founder, moved more than $140 million in XRP to exchange platforms. A MOVE interpreted as a desire to take profits at the top, or even a signal of mistrust by players regarding the sustainability of the rally.

These contradictory dynamics open the way to several scenarios. On one hand, XRP seems to benefit from renewed momentum, supported by a loyal community base and notable regulatory progress. On the other, the selling pressure initiated by some large holders, combined with persistent volatility in the overall market, could hinder any lasting progress.

Maximize your Cointribune experience with our "Read to Earn" program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.