XRP price has fallen nearly 23% over the past 30 days, extending its steepest decline this quarter. However, the token is showing the first signs of recovery, rising 6% in the past 24 hours, as several technical and on-chain indicators suggest that the worst may be over.
Taken together, these signals point to a waning of selling pressure and early signs of a potential rebound.
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Investor losses signal market bottom
Recent on-chain data shows investors are drying up, a common sign when a market is nearing bottom.
Net Unrealized Gain and Loss (NUPL) measures whether investors are profit-oriented or loss-oriented. If it turns significantly negative, it means most holders are incurring losses and is usually a sign of capitulation.
In the case of XRP, short-term holder NUPL has fallen to a one-year low of -0.20 as of October 17th, with the token trading around $2.30.
The last time such regional lows were reached was in April and June, both of which were followed by sharp rebounds. For example, on April 8, when NUPL reached -0.13, XRP rose 20% in four days. On June 22nd, NUPL was -0.15, up 74% in one month.
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NUPL, a long-term holder that tracks older investors, also fell to a six-month low of 0.53. A similar low earlier this month pushed XRP price up 10% from $2.38 to $2.62 in the short term.
Both measurements falling together suggests that fatigue is widespread among the holders and they may be primed for recovery.
Momentum indicator supports inverted view
XRP price momentum is currently validating on-chain losses reflected by NUPL. The Relative Strength Index (RSI), a technical tool that measures the strength or weakness of price movements, shows so-called hidden bullish divergences.
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From April 7th to October 10th, XRP price formed higher lows, while RSI formed lower lows. This usually occurs when the market is still trending up but has temporarily cooled down. This signal suggests that despite recent weakness, XRP’s underlying strength since April remains intact.
This coincidence between NUPL depletion and RSI divergence strengthens the idea that the XRP correction may be over and poised for an early recovery.
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Key levels to confirm XRP price recovery
XRP’s technical price structure also supports this view. Three dead line crossovers, where the short-term moving average is below the long-term moving average, have already been completed. The 20-day EMA is below the 100-day and 200-day, and the 50-day EMA is below the 100-day.
These signals often appear near the end of a bearish phase, suggesting that the correction may have run its course.
An Exponential Moving Average (EMA) is a line that smoothes price data to give a clearer indication of overall direction.
At the time of writing, XRP price is trading around $2.35. A daily close above $2.44 would be the first sign of strength, but a confirmed move above $2.59 (near the 200-day EMA) could open the way to $2.82 and $3.10.
However, if the price falls below $2.28, the recovery setup could weaken and XRP price could retest support at $2.08 or even $1.77, possibly the bottom of its broad cycle.
