Key Takeaways:
- XRP price shows hidden bullish divergence on multi-day charts.
- Key support lies between $2.00–$2.20, with potential upside to $5.
- Over $695M in shorts could fuel a powerful short squeeze.
XRP Price Signals a Hidden Bullish Divergence
XRP price is flashing a classic “hidden bullish divergence” pattern—an early sign that downside momentum may be fading and a potential price rebound could be underway. Despite recent bearish pressure, technical indicators suggest XRP’s path toward the long-awaited $5 target may not be entirely out of reach.
The divergence occurs when XRP’s price forms higher lows while the relative strength index (RSI) posts lower lows—a setup that often hints at weakening bearish momentum. Similar structures in 2022 and late 2023 preceded 69% and 49% rallies respectively, though neither resulted in a long-term breakout.
Bulls Hold Ground Around Key Support Levels
XRP has dropped nearly 12% in the last 24 hours, trading around $2.23 on Tuesday. Analysts say the $2.20 support zone could determine whether bulls can stage a recovery. The area coincides with the lower boundary of a symmetrical triangle pattern visible on weekly charts and the 1.0 Fibonacci retracement line—both strong technical anchors.
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“If we lose this range, next support lies around $1.90 to $2.00,” said pseudonymous analyst Guy on the Earth, who first spotted the bullish divergence. A rebound from this region could spark renewed momentum, potentially driving XRP toward the upper boundary of the triangle pattern at around $5—a 115% upside from current levels.
$695 Million in Shorts Could Trigger a Squeeze
Derivatives data from CoinGlass reveals XRP short positions now exceed $695 million compared to just $32 million in longs—a sharp imbalance that could set up a “short squeeze.” Most of this liquidity is concentrated between $2.60 and $3.50, meaning even a modest price rise could force short sellers to cover, amplifying upward pressure.
Conversely, long-side liquidity below $2.16 remains thin, implying that the market may have already flushed weak long positions during the recent correction.
Limited Downside, Explosive Upside
While XRP remains in a broader consolidation, the confluence of technical patterns and short positioning hints at limited downside and potential for rapid upside movement. If history rhymes, the hidden bullish divergence could again precede a swift rally—perhaps reigniting the debate over whether $5 XRP is still in play.
