XRP Risks Falling Below Support — Finding Solutions Amid Grayscale Selling Pressure

While Bitcoin, the flagship of the crypto market, is consolidating around the $62,000 level in search of direction, XRP is slipping aimlessly in the opposite direction. Despite a noticeable increase in trading volume over the past few days, the price has actually fallen below the moving averages that act as support baselines. This is interpreted as a result of XRP's own specific downward factors and the resulting erosion of investor sentiment, rather than a broad market downturn.

From a technical perspective, momentum indicators showing buying strength have been pushed below their baselines, significantly weakening upward momentum. Trend strength has also lost steam, showing a mixed trend with a downward bias. This means that despite Ripple's positive news regarding securing a license in compliance with Europe's MiCA crypto regulation, the selling pressure from Grayscale's large-scale liquidation plan is more strongly suppressing market participant sentiment.

In this report, we will conduct an in-depth analysis of the background behind the fragility of XRP's short-term support and identify key price levels that must be defended to turn the tide. Rather than predicting an unconditional rise or fall, we aim to establish wise risk management criteria by examining response points for potential future scenarios.

Rising Supply Pressure and Regulatory Barriers

XRP is facing strong short-term downward pressure after giving up its technical support levels. With buying sentiment severely suppressed on the charts, the most significant burden on market participants is the concern over actual oversupply. Specifically, concerns have grown that large-scale sell-offs could hit the market as Grayscale's $180 million liquidation plan takes shape. Added to this, news of its exclusion from major global financial indices and friction in the legislative process have made the market's psychological resistance even stronger.

Looking at the daily chart, a typical bearish pattern is observed where trading volume increases significantly while long-term moving averages show a bearish alignment. This indicates that the sell side has taken control of the market and the downward trend is becoming increasingly solid. Technical indicators measuring trend strength also point to the recent decline being more than a temporary shakeout and becoming a fixed downtrend. The Relative Strength Index (RSI), which measures market downward energy, has already entered a phase where buying momentum is extremely exhausted. However, since support should be approached as a zone of concentrated buying interest rather than a single price, we must watch if low-level buying enters and succeeds in defending the key support area near previous lows.

Of course, there is positive news that Ripple has obtained a MiCA license, the European crypto regulation, ensuring medium-to-long-term regulatory clarity. While establishing a foundation for institutional integration in the European market is clearly an important achievement, the vitality of buying demand is currently insufficient to offset the immediate large-scale potential selling pressure. The current market atmosphere, which reacts much more sensitively to bad news than good, shows how frozen investor sentiment has become. If the short-term support zone is broken on a closing basis, further downward scenarios could gain traction; conversely, if the MiCA license acquisition leads to actual institutional demand and trading volume shifts to a buying advantage, it could become a turning point that breaks the downward trend.

Conditions for Reversal and Levels to Watch

The most urgent task for XRP to escape its short-term downward trend is to recover the key support zone it recently broke. With the price having slipped below the moving average and short-term trend strength significantly weakened, the key is whether buying can enter and push the price up before this support level completely hardens into a solid resistance level. Given that overall market trading volume is somewhat stagnant and the strength of buying remains in the bearish territory, lifting the closing price back above the broken baseline in the short term will be the first step in preventing the spread of the decline.

Future actions may follow different scenarios depending on the outcome of the battle in the support zone. If selling pressure gradually subsides in the current range and trading volume shifts toward a buying advantage, there is a possibility of overcoming the temporary support break and returning to the previous stable trading range. On the other hand, if it fails to confirm further support here and slips, the downside could open up wider; therefore, it is more rational to confirm a solid bottom rather than rushing into a chase.

To gauge long-term direction, one must weigh the digestion process of negative news against the actual impact of positive developments. Tracking when the actual sell-side supply generated by the $180 million Grayscale trust liquidation schedule will be sufficiently absorbed by the market is the priority. At the same time, monitoring whether the institutional achievement of acquiring the European MiCA license leads to actual on-chain transaction activation or an influx of global institutional demand will be an important criterion for evaluating the fundamentals of XRP going forward.