XRP Price Warns Of A 25% Drop As ETF Demand Weakens And Sellers Return

TLDR

Table of Contents

XRP trades near $1.85–$1.86 support after a failed bullish divergence.
XRP-linked ETFs saw about $40.5 million in weekly net outflows.
Long-term holder balances flattened and slipped in late January.
Large wallets reduced about 90 million XRP during the recent decline.

XRP is trading near a critical support level as demand weakens. ETF outflows, flat holder activity, and whale selling increase downside risk. Markets are watching a narrow price range that could decide the next move.A daily close below support may open a deeper slide.

Price Action Signals Weak Follow-Through

XRP trades around $1.89 and sits just above the $1.85–$1.86 area. This zone marks a prior breakdown and now acts as near-term support. A hidden bullish divergence appeared between late December and January. Price formed a higher low while the RSI posted a lower low. Such signals often bring short rebounds, yet price response stayed muted.

👍 According to our social data, XRP has fallen into 'Extreme Fear' territory. Small retail traders have become pessimistic toward the #5 market cap cryptocurrency after a -19% drop since the high back on January 5th. Historically, this high level of bearish commentary leads to… pic.twitter.com/T0ARoRNDWw
— Santiment (@santimentfeed) January 22, 2026

The lack of follow-through suggests limited buyer participation. Price stalled after the signal, and momentum failed to expand. Weak reactions after bullish signals often occur during soft demand phases. Technical structure shows a rising wedge on the daily chart. A confirmed break below support could activate downside targets. Traders focus on daily closes to confirm direction.

ETF Flows Point to Cooling Institutional Demand

XRP-related ETF products posted net outflows during the latest week. Data shows about $40.5 million left funds by January 23. ETF flows reflect large and directional capital activity. A shift from steady inflows to outflows suggests a pause in demand. This change aligns with the lack of price response near support.

On-chain metrics support the same view. The Hodler Net Position Change flattened and then slipped. Long-term holders controlled about 232.1 million XRP on January 20. By January 24, balances fell near 231.55 million XRP. This move shows limited accumulation rather than aggressive selling. Flat positioning often restrains rebounds during fragile conditions.

Whale Activity Adds Supply Near Support

Large wallets reduced exposure during the same period. Addresses holding 10 million to 100 million XRP trimmed balances. Holdings declined from about 11.16 billion to 11.07 billion XRP. The reduction equals roughly 90 million XRP. At current prices, distribution totals near $170 million.

This supply helps explain the muted response to bullish signals. Selling pressure near support can cap short-term recoveries. Market data from Santiment tracks these balance changes. Whale activity often influences short-term price behavior. When selling aligns with weak demand, risks increase near support.

Key Levels to Watch as Risk Builds

A daily close below $1.85–$1.86 would confirm a breakdown. That move could target $1.70 as the first downside area. If momentum accelerates, price may test near $1.42. This path approaches a decline near 25% from current levels.

On the upside, price needs to reclaim $1.98. Such a move may reduce immediate pressure. Without renewed demand, rebounds may remain limited. As one market note states, “ETF outflows and holder pauses reduce support.”The focus remains on closes and volume near key levels.