XRP Struggles Below $2, Trade War Fears Override Strong ETF Inflows and Network Activity
XRP is holding on to support at $1.96 after breaking below the important $2 psychological mark. This is part of a six-day correction that
Quick overview
- XRP is currently holding support at $1.96 after a 19% drop from its January high of $2.41, following a market-wide liquidation event.
- Despite strong institutional demand and increased XRP Ledger transactions, macroeconomic uncertainties have negatively impacted price action.
- The open interest in XRP futures has decreased by 21.7%, indicating a decline in speculative demand amidst falling prices.
- Analysts suggest that XRP's long-term bullish structure remains intact as long as it stays above $1.30, with key support levels identified at $1.78–$1.80.
XRP XRP/USD is holding on to support at $1.96 after breaking below the important $2 psychological mark. This is part of a six-day correction that has caused the price to drop by around 19% from the January 6 high of $2.41. The selloff happens even though the fundamentals are very robust, with over $1.28 billion in cumulative spot ETF inflows and a rise in XRP Ledger transactions to levels not seen since July 2025.
The difference between strong institutional demand and lackluster price action shows how much macroeconomic uncertainty affects crypto markets. President Donald Trump’s threats of fresh tariffs on European countries over Greenland this weekend have made people afraid of new trade battles. This caused a market-wide liquidation event that affected almost all assets.
Liquidation Wave Hits Leveraged XRP Traders Hard
The drop below $2 caused a devastating deleveraging event, with XRP seeing $39.5 million in long liquidations on January 18—the biggest single-day flush since November 22, 2025. Binance alone made up over $1.05 million of the total, which shows how important it is as a place for XRP to be volatile. This forced selling happened when Bitcoin fell to $92,000 and Ethereum hit support at $3,000. The entire amount of crypto market liquidations was around $875 million across almost 250,000 dealers.
The liquidation cascade wasn’t just about technology. Market analysts say that the cause was macro-driven, with rumors that European capitals may think about imposing tariffs worth up to $107.7 billion as a response or making it harder for US corporations to get into EU markets. These news were enough to bring back fears of rising tensions across the Atlantic and cause all crypto assets to move in the same direction.
Spot XRP ETF Demand and Network Usage Fail to Stem the Bleeding
Even if prices have gone down, institutional sentiment seems to be strong. US-based spot XRP ETFs saw money coming in every day last week. On Friday alone, they added $1.12 million, bringing the total to $1.28 billion, with total assets over $1.52 billion. The Franklin XRP ETF had the most inflows on Friday, bringing its total assets to $287.75 million. During the week ending Friday, global XRP investment products brought in an extra $69.5 million, showing that institutions are still buying them up.
The basics of the network are also still very strong. On Wednesday, XRP Ledger transactions hit 2.58 million, the highest level in six months and the last time it was this high was in July 2025. This spike in activity on the blockchain shows that the network is being used a lot, but it hasn’t helped prices because people are worried about the bigger picture.
But the futures markets reveal a different story. The open interest in XRP futures has dropped from a yearly high of $4.55 billion on January 6 to $3.56 billion, a drop of 21.7%. This suggests that speculative demand is falling. Historical patterns show that lower prices could lead to more open interest drops, such what happened in October 2025.
XRP/USD Technical Analysis: Critical Support Levels Define the Next Move
According to Glassnode’s cost basis distribution heatmap, XRP is currently testing a daily order block at $1.96, where more than 1.78 billion XRP were bought during the last six months. The next big support zone is between $1.78 and $1.80, which is where about 1.84 billion XRP are held by investors. XRP has not closed a daily candle below this level since April 2025, which makes it an important battleground for bulls.
If this support doesn’t hold, the next targets on the downside are the $1.61 local low from October and the 200-week exponential moving average near $1.41. This is the last line of defense for the larger bullish structure. The Relative Strength Index is at its lowest point since 2026, which means that the market is getting more bearish. This confirms warnings that if the price breaks below the $2 descending channel support line, losses might reach $1.75 and then $1.61.
XRP Price Prediction: Long-Term Structure Remains Intact Above $1.30
Even though XRP is poor in the short term, analysts say that its multi-year bullish structure is still valid as long as the price stays over $1.30. The asset broke out of a descending wedge pattern that had been forming since 2020 and 2024, which caused a surge of more than 600% from the $0.60 level and confirmed a change in the long-term market structure.
XRP is currently following a fair value gap and accumulation zone between $1.90 and $1.30, which is still a key demand area. Some analysts still think that the price may go up to $3.50, $5.00, $8.70, and maybe even above $10 over the long term. However, these predictions would not hold true if the price closed below $1.30 on a greater time period.
For bulls, the first thing they need to do is go back to the $2.10–$2.20 level, which would mean the correction phase is over. Until then, there is still a chance that XRP can test $1.85 again. The $1.78–$1.80 support zone is the key level for XRP’s short-term direction. If strong ETF inflows and network fundamentals will eventually overcome macro challenges, this correction might be a consolidation before the next expansion or the start of a deeper regression.
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