XRP Price Outlook: Funding Rates and On-Chain Data Hint at Rebound

TLDR

• XRP price remains bearish below $2.00, with $1.78 acting as critical downside support.
• Persistent negative funding signals crowded shorts and rising short-squeeze risk.
• On-chain data shows heavy resistance between $1.97–$2.11 from breakeven supply.
• A breakout above $2.00 could shift structure bullish and trigger momentum recovery.

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Ripple’s XRP is trading near critical technical and on-chain levels after an extended corrective phase. Recent data highlights weakening downside momentum alongside persistent bearish positioning. Analysts point to key price targets at $1.78 support and $2.00 resistance as defining levels for the next phase of XRP price action.

XRP Price Structure Shows Bearish Control Below $2.00

According to analyst Efloud, XRP’s broader structure reflects a clear transition from distribution into a sustained downtrend. Price has consistently printed lower highs since rejecting the $2.30–$2.50 supply zone. This zone represents heavy institutional distribution and remains a major ceiling for rallies.

Following the rejection, XRP entered a brief consolidation before breaking down again. The recent bounce from the $1.78 zone appears corrective, not impulsive. This suggests demand remains reactive, with buyers responding to price weakness rather than driving trend reversals.

From a technical perspective, $1.78 now acts as critical support. A failure to hold this level would likely expose deeper downside liquidity. On the upside, reclaiming $1.97 and especially $2.00 is required to shift XRP price structure bullish on higher timeframes.

Negative Funding Rates Signal Crowded Short Positions

Meanwhile, according to analyst Steph Is Crypto, Binance funding rates provide insight into market sentiment. Funding has remained persistently negative, indicating traders are heavily positioned short. This shows bearish conviction but also raises the risk of overcrowding.

Historically, extended periods of negative funding often coincide with price stabilization. In prior cycles, such conditions preceded relief rallies as selling pressure weakened. When price stops making lower lows while funding stays negative, short exhaustion becomes a factor.

From a contrarian standpoint, negative funding alone is not a buy signal. However, if XRP holds key support while funding remains suppressed, conditions for a short squeeze improve. A shift in funding toward neutral, combined with a resistance reclaim, would strengthen recovery prospects for XRP price.

On-Chain Supply Data Highlights Key XRP Price Levels

Addirionally, analyst Ali provided on-chain context through URPD data. The chart shows a heavy supply cluster between $1.97 and $2.11. This zone represents tokens last moved near breakeven, creating strong overhead resistance.

Below current levels, $1.78 stands out as a significant support cluster. This aligns with prior demand zones where accumulation occurred with conviction. Sustained trading above this zone suggests long-term holders remain engaged despite recent volatility.

From a structural view, three levels dominate the current setup. Support sits at $1.78, while resistance stands at $1.97 and $2.00. A clean break above $2.00 would invalidate a large portion of overhead supply. Conversely, losing $1.78 would weaken XRP price position on-chain.

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