Largest on-chain realized loss spike since 2022 sends XRP below $1.40 as retail investors hit the panic button over Bitcoin (BTC) dropping toward its February low of $60,000. The on-chain data and demand for US XRP-spot ETFs sent conflicting signals, leaving XRP with heavier losses in February.
On Sunday, February 22, XRP dipped to a session low of $1.3805 before steadying.
Increased optimism about US banks and crypto representatives agreeing on stablecoin yields to progress the Market Structure Bill cushioned the downside. Resilient demand for US XRP-spot ETFs underscored institutional investor sentiment toward XRP utility and the prospect of crypto-friendly legislation.
These fundamentals support a bullish medium-term (4-8 weeks) outlook for XRP, with a price target of $2.5.
Below, I will explore the key drivers behind recent price trends, the medium-term outlook, and the technical levels traders should watch.
On-Chain Data Spooks Retail Investors
Last week, market intelligence platform Santiment commented on surging on-chain realized losses, which weighed on retail investor sentiment. Santiment stated:
“XRP has seen its largest on-chain realized loss spike since 2022. […]. Significant realized losses happen when a large number of investors sell their coins at a price lower than what they originally paid. This usually coincides with fear taking over. When traders panic and capitulate, they lock in their losses instead of holding and hoping for a rebound.”
However, Santiment added that historically, these trends could signal a breakout, stating:
“Historically, large spikes in realized losses often show up near market bottoms. This is because extreme fear tends to peak before price does. Once sellers are exhausted, even a small amount of new buying pressure can push prices higher. That does not guarantee an immediate rally, but it increases the probability of a bounce.”
According to Santiment:
“When the previous weekly milestone of -1.93B in realized losses occurred 39 months ago, XRP proceeded to jump +114% over the next 8 months.”
Crucially, resilient demand for XRP-spot ETFs and extreme fear suggest a potential price recovery. However, the progress of the Market Structure Bill will be key, given XRP’s price sensitivity to crypto-related legislative developments.
Analysts expect crypto-friendly legislation to strengthen Ripple’s momentum on Main Street and boost XRP utility. Crypto-spot ETF flow trends suggest that institutional investors hold a similar view.
The US XRP-spot ETF market saw $1.84 million in net inflows in the reporting week ending February 20, extending the inflow streak to three weeks. In contrast, the US BTC-spot ETF market saw net outflows of $315.9 million, extending the outflow streak to five weeks.
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See all Bitcoin forecastsXRP Price Forecast: Short-, Medium-, and Long-Term Targets
XRP has fallen 5% year-to-date, supporting a cautiously bearish short-term outlook (1-4 weeks), with a target price of $1.0.
However, XRP-spot ETF flows, improving sentiment toward the US Senate passing the Market Structure Bill, and increased XRP utility affirm the bullish medium- to long-term price projections:
- Medium-term (4-8 weeks): $2.5.
- Longer-term (8-12 weeks): $3.0.
Key Downside Risks to the Bullish Medium-Term Outlook
Several events could unravel the constructive medium-term bias. These include:
- A US-Iran conflict.
- US economic data cool bets on an H1 2026 Fed rate cut.
- Delays and/or partisan opposition to the Market Structure Bill.
- Extended periods of XRP-spot ETF net outflows.
Additionally, traders should consider Bank of Japan rhetoric and USD/JPY trends, given the impact of the mid-2024 yen carry trade unwind on XRP.
A hawkish Bank of Japan, with a higher neutral interest rate (potentially 1.5%-2.5%), would signal multiple BoJ rate hikes. Multiple hikes would narrow US-Japan rate differentials in favor of the yen. Narrowing rate differentials could trigger a yen carry trade unwind, drying up market liquidity. For context, the BoJ previously announced a wider neutral rate band of 1%-2.5% but stated it would announce a narrower range at a later date.
These events would weigh on XRP, send the token toward $1.0, and reinforce the cautiously bearish short-term outlook.
Technical Analysis: Levels to Watch
XRP slid 2.57% on Sunday, February 22, reversing the previous day’s 0.08% gain to close at $1.3933. The token faced heavier losses than the broader crypto market cap, which dropped 0.77%.
The pullback left XRP well below its 50-day and 200-day EMAs. The EMA positions indicated a bearish bias. The 50-day EMA steepened against the 200-day EMA, suggesting increasing near-term selling pressure. However, several favorable fundamentals continue to offset bearish technicals, supporting the bullish medium-term outlook. Despite these favorable fundamentals, short-term technicals remain bearish.
Key technical levels to watch include:
- Support levels: $1.0, and then $0.7773.
- 50-day EMA resistance: $1.6562.
- 200-day EMA resistance: $2.0947.
- Resistance levels: $1.5, $2.0, $2.5, and $3.0.
On the daily chart, a breakout above $1.50 would enable the bulls to target the 50-day EMA. A sustained move through the 50-day EMA would indicate a near-term bullish trend reversal. A bullish trend reversal would pave the way toward the 200-day EMA.
A sustained break above the EMAs would affirm a bullish trend reversal and reinforce the medium- to longer-term price targets.
Fundamental Events Driving Near-Term Price Action
Near-term price drivers include:
- XRP-spot ETF flow trends.
- US economic indicators and the Fed rate path.
- Crypto-related regulatory developments.
- The Bank of Japan’s neutral rate and policy stance.
- Rising geopolitical tensions in the Middle East.
Bearish Structure Intact: $1.0 Remains Crucial Support
Following Sunday’s loss, XRP ended the week down 5.56%, affirming the existing bearish trend. A break below the lower trendline would bring the February 6 low of $1.1227 into play. If breached, $1.0 would be the next key support level. A sustained fall through $1.0 would reinforce the cautiously bearish short-term outlook and further validate the bearish structure.
However, a breakout above $1.5 would open the door to testing $2.0 and the upper trendline. A sustained move through the upper trendline would invalidate the bearish structure and indicate a bullish trend reversal, reinforcing the constructive medium-term bias.
- Short-term (1-4 weeks): $1.0.
- Medium-term (4-8 weeks): $2.5.
- Longer-term (8-12 weeks): target of $3.0.
XRP Outlook: Geopolitics, Crypto Legislation, and ETF Flows in Focus
Looking ahead, developments in the Middle East will influence market risk appetite. An increased threat of a US-Iran conflict would likely overshadow crypto-related legislative developments.
Nevertheless, the continued progress of the Market Structure Bill on Capitol Hill would reinforce the bullish medium- to longer-term outlook for XRP.
However, central bank rhetoric, US economic data, President Trump’s tariff policies, and XRP-spot ETF flow trends will also dictate XRP’s price projection.
A more dovish Fed and a lower BoJ neutral rate (potentially 1%-1.25%) would boost sentiment. Robust demand for US XRP-spot ETFs and favorable crypto-related legislative developments would drive buying interest in XRP.
In summary, these scenarios would support a medium-term (4–8 weeks) move to $2.5. The US Senate passing the Market Structure Bill would reaffirm the longer-term (8-12 weeks) price target of $3.0.
Beyond 12 weeks, these events may send XRP to its all-time high of $3.66 (Binance). A break above $3.66 would reaffirm a 6- to 12-month price target of $5.